Skip to Content Subscribe Our Offers My Account Manage My Subscriptions FAQ Newsletters Canada Canadian True Crime Canadian Politics Health World Israel & Middle East Financial Post NP Comment Longreads Puzzmo Diversions Comics NP News Quiz New York Times Crossword Horoscopes Life Eating & Drinking Style Sponsored Play for Ontario Travel Travel Canada Travel USA Travel International Cruises Travel Essentials Culture Books Celebrity Movies Music Theatre Television Business Essentials Advice Lives Told Tails Told Shopping Buy Canadian Home Living Outdoor Living Kitchen & Dining Tech Style & Beauty Personal Care Entertainment & Hobbies Gift Guide Travel Guide Amazon Prime Day Deals Savings National Post Store More Sports Hockey Baseball Basketball Football Soccer Golf Tennis Driving Vehicle Research Reviews News Gear Guide Obituaries Place an Obituary Place an In Memoriam Classifieds Place an Ad Celebrations Working Business Ads Archives Healthing Epaper Manage Print Subscription Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ Newsletters Canada World Financial Post NP Comment Longreads Puzzmo Diversions Life Shopping Epaper Manage Print Subscription HomeNP CommentColby Cosh: How long before Statistics Canada loses complete touch with the economy?The national statistics agency's predictions are getting worse, even though data has never been easier to crunchLast updated 18 minutes ago You can save this article by registering for free here. Or sign-in if you have an account.Photo by HYUNGCHEOL PARK/PostmediaLast month, when Statistics Canada delivered unexpected bad news about a second consecutive quarter of negative real-GDP growth, there was a frenzy of pooh-poohing and counter-pooh-poohing about whether Canada was really in recession. On Thursday CP’s Craig Lord called attention to a different angle on the whole fuss, which isn’t the notional recession (yet), but the forecasting failure that preceded it. Economists at the Desjardins credit-union consortium are warning that StatCan’s monthly economic estimates are growing wobbly, leading to larger retrospective revisions — i.e., bigger surprises — when quarterly and yearly data are released later.Enjoy the latest local, national and international news.Exclusive articles by Conrad Black, Barbara Kay and others. Plus, special edition NP Platformed and First Reading newsletters and virtual events.Unlimited online access to National Post.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles including the New York Times Crossword.Support local journalism.Enjoy the latest local, national and international news.Exclusive articles by Conrad Black, Barbara Kay and others. Plus, special edition NP Platformed and First Reading newsletters and virtual events.Unlimited online access to National Post.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles including the New York Times Crossword.Support local journalism.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountorThe Desjardins report (“Diagnosing the Data Quality Crisis”), authored by Randall Bartlett and L.J. Valencia, acknowledges that this is a bizarre phenomenon. We live in a world deluged by new forms of data available at previously unfathomable scales, and we’re plunging into an artificial-intelligence singularity — but our statistical agency is somehow getting dumber?This newsletter from NP Comment tackles the topics you care about. (Subscriber-exclusive edition on Fridays)By signing up you consent to receive the above newsletter from Postmedia Network Inc.We encountered an issue signing you up. Please try againSure, this may not be the most neutral way to put it, but the disorder is verifiable. The Q1 GDP mal-estimates by forecasters, who were depending on monthly StatCan business-sector data, weren’t modest or unimportant: that’s why the “recession” bunfights happened. Annualized growth in the Canadian economy ending up falling short of initial guesses by two full percentage points, with a change in the mathematical sign of the bottom-line figure.It appears, upon close study, that StatCan’s survey-driven approach to sector monitoring is losing touch with major areas of the Canadian economy. The numbers the agency collects from resource extraction, finance and government are as robust as they ever were. But there has been a collapse of reliability in the short-term numbers on manufacturing as well as retail and wholesale trade. One particular sentence in the Desjardins report leaps out at the data-conscious reader: “In the case of real retail trade specifically, the monthly sales data now provide no insight into the direction of the underlying monthly real GDP category.” I would underline this for my colleagues down the hall at the Financial Post: a data release that you snatch at like piranhas has, since the pandemic, become statistical noise.Your immediate reaction to this should be: “I bet the folks at Amazon know to a pretty high degree of precision how the aggregate state of retail sales in Canada is changing from afternoon to afternoon, never mind month to month.” Desjardins’ diagnosis of the problem is speculative. A lot of the statistical degradation they document is a post-COVID phenomenon, and may reflect economic anomalies out there in the still-rebuilding real world. (Certainly, when it comes to retailing, we are still a few years from everything being “back to normal,” whatever that will look like.) The economists also observe that the recent wild swings in immigration policy and volumes — both here and in the U.S. — are hard on the accuracy of labour-force surveys and other instruments.There has been some overall damage to the accuracy of American trade and labour statistics, caused by the republic’s political turbulence, including contrived “government shutdowns,” and that creates downstream injuries to Canadian economic estimates. And meanwhile StatCan is bracing for prospective Carneyan budget cuts.But some parts of the crisis may be permanent, and will require legitimate innovation. Canada’s a world leader on digital payments — in many ways on the precipice of becoming a cashless civilization — so there is really no excuse for publishing, or for enduring, such poor retail-sales data estimates. Even Joe Laptop can gather data on air and sea movement and nighttime illumination in cities. “Artificial intelligence” in its undisguised, PR-free form — Bayesian statistics and other mathematical forecasting tools — will play a greater role. And while some people won’t like to hear this, prediction markets that reward good guesses at economic aggregates could be a near-panacea for the crisis if they’re allowed to become deep enough.National Post Join the Conversation This website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.