Centre for Future Work

Canada’s public health care system, which provides essential health services without regard to ability to pay, is one of our most cherished social achievements. Indeed, public opinion polls consistently show that medicare is the single feature Canadians most associate with our national identity. Support for universal public health care is thus an important element of Canadians’ response to the challenges to our economy and sovereignty posed by U.S. President Donald Trump.

However, the medicare system is under threat from inadequate funding, long wait times for some services, and ongoing pressure from investors to privatize services. In Alberta, new laws allow parallel private provision of key health care services (including diagnostic tests and some surgeries). Other provinces (such as Ontario) are also pushing privatization. Always underlying privatization efforts is the claim that Canada simply cannot ‘afford’ the big costs of the public health care system.

At the recent summit meeting of Canadian premiers held in Charlottetown, P.E.I. in July, premiers discussed the challenges of financing health care and called on the federal government to hold a national summit on future health funding. At the summit, Centre for Future Work Director Jim Stanford made a presentation to the premiers on the economic benefits of public health care. He stressed that health care ranks as one of the most important industries in Canada: it creates jobs, generates incomes, supports widespread economic spillovers, and is one of Canada’s leading sources of innovation and new technology. These benefits have to be considered alongside the costs of providing essential health services.

Here is the presentation which Stanford gave to the premiers. It drew on findings from a recent report Stanford prepared for the Canadian Federation of Nurses’ Unions, titled The Economic Benefits of Canada’s Public Health Care System. The report quantified the important ways in which public health care supports employment, incomes, economic growth, and government revenues. Seen this way, health care should be redefined as an investment—not just a cost item on provincial budgets.

Key findings from the report include:

• Health care is one of Canada’s largest and most dynamic industries.
• It employs 1.9 million waged or salaried employees, and hundreds of thousands more self-employed practitioners, specialists, and contractors.
• Health care production accounts for about 8% of Canada’s total value-added (GDP), and over 10% of total employment.
• Health care workers earn $120 billion per year in wages and salaries.
• The health care system purchases $51 billion worth of supplies and inputs from a complex and far-reaching supply chain (composed mostly of private businesses).
• Health care accounts for over $7 billion in annual research spending, the second highest of any Canadian industry.
• Because health care is not highly integrated in international trade, it is relatively protected from global disruptions and shocks (like the effects of U.S. trade policies).
• Universal access to quality health care unlocks many other economic benefits including: more flexible labour markets (workers are able to change jobs without fear of losing health coverage), enhanced longevity and well-being (supporting more labour force participation and higher productivity), and improved ‘social capital’ (safe and inclusive communities where interactions can occur more securely and efficiently).

In sum, health care cannot be understood solely as a ‘cost.’ It is also a powerful economic engine: a source of growth, jobs, incomes, tax revenues, and well-being. Understanding and appreciating the economic benefits of the universal public health care system can reinforce public and fiscal support for its maintenance and improvement.

Please see the full report here.

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On August 7 both Statistics Canada and the U.S. Bureau of Labor Statistics released their monthly labour force reports (for July). The stark contrast in the two trends certainly strengthens Canada’s hand in ongoing trade talks with Trump. Canada created 75,000 jobs in July. The U.S. lost 23,000 jobs by one measure (the payroll survey of employers), 87,000 by another (the household survey of workers).

But the longer-term trends also refute Trump’s chaotic economic and geopolitical policies. Since January 2025 (his second inauguration), US employment has declined by 1.0% (by the household survey), the unemployment rate has grown, and the participation rate (which has been much lower than Canada’s for years) has fallen much more.

In Canada, employment rose 1% in the same time, the unemployment rate fell, and the participation rate (which reflects both demographic and cyclical factors) declined 0.4 percentage points (one third as much as in the US). Even in manufacturing, the target for Trump’s tariffs, the US has lost more jobs than Canada since Trump returned to office. This is also true in the high-profile auto sector, which Trump claims should completely relocate to the US: it is losing jobs much faster in the US than in Canada.

Real wages are growing in Canada, but falling in the US. This reflects both strong wage growth here, and slower inflation. 

Trump’s policies were never about protecting American workers. They are about weaponizing popular discontent and misdirecting it against foreigners—rather than against the billionaires whose interests he promotes. The longer he’s in power, the weaker the US economy becomes, the worse off are American workers, and the more dismal do his mid-term prospects appear.

Also, the worse the US economy gets, the weaker is Trump’s bargaining position in trade talks (including with Canada and Mexico). With Republicans down badly in the polls as mid-term elections approach, Trump’s tariff war is losing credibility at home quickly.

In short, Trump’s pledge to use “economic force” to annex Canada is backfiring badly. Labour market trends show both that Canada’s economy is more resilient than most expected, but also that Trump’s bargaining position will weaken as more US jobs are lost to his misguided tariffs.

Centre for Future Work Director Jim Stanford discussed the July employment numbers, and the contrast between Canada and the U.S., on CBC News Network with host Lien Yeung.

One nerdy data note: The US releases its payroll and household surveys the same day. The series differ for various reasons, such as self-employment & agriculture (not counted in the payroll data), and multiple job-holding (which inflates payroll employment). US household data has been weaker than payroll data under Trump’s second term, in part because it does count agricultural employment (which has been hurt badly by Trump’s repressive immigration policies).

Canada’s payroll data (from the SEPH series) comes out a few weeks later than the household survey data discussed above, so we can’t make a direct Canada-US comparison for payroll employment in July yet. For May (the most recent Canadian payroll data), Canadian payroll employment was up 0.5% from January 2025, vs a 0.4% increase in the US (both seasonally adjusted). That gap will have widened since May, which will be confirmed when the July data comes out for Canada.

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U.S. President Donald Trump’s misguided war against Iran has caused another shock in global oil prices – the 14th such shock in the last half-century. World oil prices rose 50% or more after the war started, and have stayed high despite Trump’s repeated promises to stop the war and reopen the Strait of Hormuz. These price increases are is driving massive increases in profits for petroleum companies around the world – including Canada.

Canada produces three times more oil than it consumes. And while Canada imports small amounts of oil to the eastern provinces, almost none of that is sourced from the Persian Gulf. Hence there is no significant impact of the war on our domestic supply volumes or costs.

Nevertheless, because of a policy choice to tie domestic oil and petroleum product prices to global benchmarks (allowing oil producers to charge Canadians world prices for their own oil, on pain of diverting supply to more lucrative foreign markets), Canadian petroleum prices have soared in tandem.

The combination of sky-high prices with stable production costs is producing a profit windfall for Canadian petroleum companies. This is confirmed by the recent release of financial reports by publicly-traded Canadian oil companies for the second quarter of 2026.

The table below summarizes after-tax earnings and other metrics for the four largest publicly-traded Canadian producers. Their combined revenues (net of royalty payments) grew almost 50% in the April-June period, compared to the year-earlier period, thanks to the effect of Trump’s war on world prices.

After-tax profits rose more dramatically, since production costs remained largely unchanged. After-tax profits at the big four more than doubled: rising 144% compared to the second quarter of 2025, reaching a combined total of $13.3 billion. That’s almost $150 million per day in after-tax profit over the three-month period.

These four companies represent only a portion of the Canadian petroleum sector. Financial results for many companies (including wholly-owned subsidiaries of foreign oil companies) are never publicly reported. However, Statistics Canada publishes helpful financial data on an industry-wide basis. That data for the second quarter of 2026 will be released later in August.

Extrapolated to apply to the broad Canadian petroleum sector (upstream and downstream), the big four’s results suggest that second-quarter industry-wide profits could reach $30 billion (up from $12.6 billion in the second quarter of 2025). Canadian oil profits for the full year could reach $100 billion. That would set a new all-time record, smashing the peak $68 billion after-tax profit the industry recorded in 2022 (when oil prices were similarly shocked following the Russian invasion of Ukraine).

What are the oil companies doing with this record profit flow? There is no robust pattern of reinvestment in new Canadian projects. In fact, excluding acquisitions of other companies and properties (which does not represent an increase in real investment), capital spending by the big four companies actually declined slightly in the second quarter (compared to the year earlier period).

Instead, their main priority is to pay out so-called “excess cash” to company owners, in the form of increased dividend payments and share buy-back programs. Companies buy back their shares as a way of boosting share prices (this benefits company executives, too, through share-based compensation systems). The four majors spent over $6 billion on share purchases and dividend payments in the second quarter, up by almost $2 billion from like period 2026.

Hopes that booming oil profits will lead to new investment and jobs in the petroleum sector are being dashed by the priority these firms are placing on cash payouts, rather than reinvestments.

But the combination of record profits and rapid share buybacks has been great for company owners. Share prices at the big four majors have increased by an average of 45% since the start of the year. Most of those gains are captured by the wealthiest minority of the population. Other Canadians experience only higher costs and declining real incomes.

Research on the distribution of global oil profits during the 2022 price spike confirms that each oil shock further redistributes income upward. Global oil profits almost doubled that year, to nearly $1 trillion (U.S.). In the U.S., 50% of those gains were received by the richest 1% of the population; the bottom 50% of the population got almost none. A less extreme, but similar, pattern prevails in Canada.

In the meantime, oil-fueled inflation remains a threat to living standards and economic performance for most Canadians – those who do not own significant equity holdings in oil companies. Inflation has increased again in Canada since the Iran war started (just as it did in 2022 after the oil shock accompanying the invasion of Ukraine).

Spillover price increases for other goods and services (whose costs of production also increase due to high petroleum prices) will amplify inflationary pressures. And if the Bank of Canada responds with higher interest rates (as it will if above-target inflation persists), Canadians will be punished further with higher interest costs, on top of sky-high gasoline prices and faster broader inflation.

The current oil price shock, just the latest in an ongoing pattern of global price volatility, confirms that fossil fuel prices are the greatest threat to affordability and living standards for Canadian workers and consumers. Please follow the Centre for Future Work’s False Profits project for more details on the impact of oil prices on prices, real wages, and inequality in Canada.

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