From GDP to Community: Why Corporate Profit Is Not a Measure of Wellbeing

The Economy We Live In

There is a quiet assumption built into how we talk about the economy:

That if corporations are profitable, the country must be doing well. It sounds reasonable. It’s repeated constantly. It is rarely questioned. But it doesn’t hold. 

What We Measure - and What We Miss

Corporate profit measures one thing: how much value firms are able to extract or retain.

While a similar story can be told all over the world, in Canada, corporate profits have reached historic highs in recent years. Corporate income before taxes in Canada grew 47% between 2018 and 2022, rising from about $440 billion to $646 billion (Parliamentary Budget Officer), and Corporate profits reached over 21% of Canada’s GDP in 2022, the highest level on record (Centre for Future Work),  while at the same time:

  • housing costs have outpaced income growth in most major cities (Canada Mortgage and Housing Corporation)

  • household debt has remained among the highest in the G7 (Bank of Canada)

  • Many workers report declining real purchasing power after inflation

This is what economists describe as a decoupling: output and profits rise, while everyday financial stability does not keep pace.

A System Can Perform - and Still Fail

We now live in economies where profits can rise, markets can expand, GDP can grow all while people experience increasing instability. This is not a contradiction. It is a design feature.

The OECD has repeatedly found that:

economic growth does not automatically translate into broad improvements in living standards.

At the same time, research from the International Monetary Fund shows a long-term decline in labour’s share of income, meaning a greater portion of economic gains are going to capital rather than workers.

A system can be highly productive while misallocating resources, concentrating gains, and operating below its full human capacity. 


The Economy People Actually Live In

Most people do not experience the economy through corporate earnings or GDP reports.

They experience it through what I would call the everyday - or lived - economy:

  • healthcare

  • food

  • housings

  • childcare

  • personal services

  • local businesses

  • hospitality

  • arts and culture

  • community spaces

This is the part of the economy where people work, where money circulates, and quality of life is determined. 


The Foundation of a Community Economy

What is often dismissed as “service” or “downstream” activity is, in reality, the foundation of community-based economies.

These sectors employ a large share of the population, anchor local economic activity, and determine whether income actually translates into a liveable life. 

In Canada, the majority of employment is already in service-based sectors - including healthcare, education, retail, hospitality, and personal services (Statistics Canada).

This is not a secondary layer of the economy. It is the layer through which economic value is experienced, circulated, and sustained


Arts, Culture, and the Mental Economy

Within this everyday economy, arts and culture are often treated as optional. But the data tells a different story.

According to Statistics Canada:

  • The culture and arts sector contributes over $60 billion annually in direct GDP

  • When broader impacts are included, it exceeds $130 billion in economic activity

  • It supports over 1.1 million jobs across the country

The economic contribution is only part of the picture.

Arts and culture also support:

  • social connection and emotional resilience

  • community identity

  • creative capacity and innovation

  • mental health and emotional resilience

The Canada Council for the Arts has linked cultural participation to improved health outcomes, stronger community cohesion (for those concerned about immigration), and increased civic engagement.

A system that neglects this layer often sees rising isolation, increased mental health strain, reduced social cohesion.  Which in turn increases healthcare costs, economic instability, and long-term m system strain. 


Circulation, Not Just Production

An economy does not function simply because it produces.

It functions when value moves through it in a way that supports people.

When money circulates locally business survive, jobs stabilize, and communities become more resilient. 

When value is concentrated or extracted instability increases, costs shift onto individuals, communities weaken. 

This is where the everyday economy becomes measurable.

You can assess system health through local business strength, affordability, arts and culture, access to services, and community participation.  These are not abstract ideas.

They are indicators of whether value is actually reaching people.


Infrastructure Is Not a Cost

Healthcare. Education. Housing. Culture.

These are often framed as burdens on the economy. But they are not external to it. They are what allow it to function.

  • Healthcare maintains wth workforce capacity

  • Education develops it

  • Infrastructure enables it

  • Culture sustains it

Without these systems, productivity declines and instability rises.

We Are Measuring the Wrong Things

If we want to understand how a country is actually doing, we need to shift what we measure.

Not just:

  • Corporate profits

  • GDP growth

  • job counts

But:

  • strength of local economies

  • housing affordability

  • access to healthcare and childcare

  • mental health and social connection

  • cultural participation and community engagement 

  • income relative to cost of living 

These indicators reflect whether the system is functioning for people.

A Call for a Different Language

Politicians shape public understanding through the terms they use.

When success is defined as growth, expansion, and corporate performance policy follows that logic. This may be a hard pill for people to swallow: we don’t need an every expanding economy to improve quality of life; what we need is something that works for the people in it. 

If we begin to speak in terms of:

  • stability

  • circulation 

  • quality of life

  • community infrastructure 

  • and cultural wellbeing 

We shift the frame entirely.

The Shift

This is not an argument against industry or production.

It is an argument for accuracy. 

A country is not doing well because its corporations are profitable.

It is doing well when: communities are functioning and the systems that support daily life and strong. 

Closing

The economy is not just what we produce.  It is what we live.

And until we measure it that way, we will continue to mistake activity for success - and overlook the conditions that actually sustain us.

There is no shortage of alternatives to GDP. Measures such as the Human Development Index, the OECD Better Life Index, and the Genuine Progress Indicator already track health, education, stability, and wellbeing. Alongside these, we can directly measure income relative to cost of living, housing affordability, mental health, and community participation. The issue is not that we lack tools - it is that we continue to prioritize metrics that measure economic activity over those that measure whether that activity actually supports people.

  • Statistics Canada – Labour force, culture GDP, income data

  • Canada Mortgage and Housing Corporation – Housing affordability

  • Bank of Canada – Inflation, household debt

  • OECD – Inequality and growth

  • International Monetary Fund – Labour share of income

  • Canada Council for the Arts – Cultural impact

Design SmartJulianne Chladnyfeminism, social justice, economics