Poor health cost Canada more than $100 billion in economic output in 2025: Deloitte Canada

Toronto, September 22, 2026 – A new Deloitte Canada report reveals that poor health and related caregiving is not only a social challenge, but a significant constraint on Canada’s workforce and economy. Using a first-of-its-kind Health Productivity Gap (HPG) framework, the analysis finds that health-related barriers to workforce participation cost the country more than $100 billion in economic output in 2025, while reducing those barriers by 25% could recover more than $25 billion annually.

Canada's productivity performance has lagged other advanced economies for more than a decade, while health outcomes have deteriorated and workforce pressures related to chronic disease, mental health challenges and caregiving responsibilities continue to grow. Deloitte's HPG framework, which quantifies the economic cost of poor health and caregiving in Canada, suggests these trends are closely connected yet insufficiently recognized, with health-related barriers increasingly limiting labour force participation and constraining economic output.

"Productivity is one of Canada's most pressing challenges, yet health is rarely considered part of the productivity agenda," says Michelle Theroux, National Health Leader at Deloitte Canada. "We cannot expect technology, AI, or workforce upskilling to solve Canada's productivity challenge if people are increasingly sidelined by illness, poor mental health, or caregiving responsibilities. Better health is not just an outcome of a strong economy. It is a prerequisite for one.”

The analysis identifies two major opportunities to improve outcomes: 1. The prevention gap, reflecting capacity lost to preventable illness, and 2. The participation gap, reflecting capacity constrained by chronic disease, mental health challenges and caregiving responsibilities. It also outlines seven key integrated actions that governments, health care organizations, employers and other stakeholders can pursue to help close these gaps, improve quality of life and position Canada for stronger long-term growth. Integrated actions include:

• Enroll every Canadian in a Health Home (integration of primary care and prevention)
• Make prevention proactive and personalized
• Remove barriers to participation (in receiving health care)
• Give individuals financial tools for prevention
• Create capacity from what we already have
• Meaningfully digitize health infrastructure
• Redesigning financing and incentives

"There is no single solution to Canada’s health-productivity gap, but there are practical steps we can take now that will pay dividends in both the near and long term, " says Matthew Stewart, Partner, Economic Advisory, Deloitte Canada. "Better prevention, improving workforce participation and smarter use of existing capacity and technology could unlock billions in economic value and strengthen Canada’s long-term growth."

Additional report findings:

• $55.1 billion in lost economic value was associated with morbidity, including time away from work due to illness.
• $48.5 billion in lost labour income was associated with unpaid caregiving responsibilities.
• $1.1 billion in lost economic output was associated with premature mortality during the period required to replace and train workers.
• Reducing caregiving burdens by 25% could generate more than $12 billion in economic gains.
• Reducing morbidity-related impacts by 25% could generate more than $13 billion in GDP gains.

To learn more read the full report: The health-productivity gap: Canada's untapped lever.