Canada's GDP shrinks slightly even as accommodation, arts, entertainment, and recreation sectors post big increases

Canada's economy went sideways in July, according to Statistics Canada, with significant growth in some areas but declining activity in some sectors.

Overall, the gross domestic product contracted by 0.1 percent compared to the previous month, even though there were improvements in 13 of 20 sectors.

That was better than earlier Statistics Canada forecast for a 0.4 percent decline in July.

Arts, entertainment, and recreation was one of the bright spots, seeing an 8.1 percent rise in economic activity in July. This was "mainly on the strength of the amusement, gambling and recreation industries", according to Statistics Canada.

"The easing of restrictions across many parts of the country facilitated reopening or increased capacity at amusement parks, indoor and outdoor recreational facilities (including gyms, yoga studios, pools, and arenas) and casinos," the national agency reported.

Accommodation and food services also showed a big boost, up 12.5 percent. The biggest increase, 21.2 percent, occurred in accommodation as domestic and international travel increased in July. Food services and drinking places registered a 9.5 percent rise on the month.

Things weren't nearly as rosy for the farming and forestry, however. That's because a deadly heat wave and drought conditions wreaked havoc.

The production of crops (not counting cannabis) posted a 13.2 percent decline in July, falling to its lowest level since the fall of 2007.

Wildfires in B.C. and northwestern Ontario contributed to a 3.9 percent drop in forestry and logging.

Manufacturing contracted by 1.1 percent in July. And economic activity in residential construction fell 2.7 percent, marking the third consecutive monthly decline in this sector.

"Almost all types of residential buildings construction activity were down, led by single-family homes and home alterations and improvements," Statistics Canada stated.

Nonresidential construction, on the other hand, posted a 0.5 percent increase, thanks to institutional building construction. Commercial and industrial building construction fell during the month.

It was also another grim month for the wholesale-trade sector, which fell by 1.9 percent in July. That's the fourth straight monthly fall. The largest drop within the nine sectors occurred in building material and supplies, which contracted by nine percent in July.

Retail trade was down by 1.1 percent in July. Of the 12 subsectors, there was one bright spot—clothing and clothing accessories stores—which posted a 6.2 percent increase. But garden equipment and supplies dealers saw a 6.5 percent decline and food and beverage stores were down by 3.3 percent.