Ontario needs growth and prosperity in all regions—not just two big ones

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Appeared in the Ottawa Sun, November 27, 2019
Ontario needs growth and prosperity in all regions—not just two big ones

Last week the Fraser Institute published a study on the economic performance of Atlantic Canada, which found that economic production (on a per-person basis) in the region was only 83.5 per cent of the average in the rest of the country—almost exactly the same number as 15 years ago.

The study also found that labour productivity (measured by production per employee) is much lower on average in Atlantic Canada than in the rest of the country. These data should concern not only Atlantic Canadians but all Canadians. The country can’t reach its full economic potential unless every region prospers.

But we don’t need to look east to find regions of Canada that have struggled in recent years. Right here in Ontario, regions with hundreds of thousands (or even millions) of people have endured weak growth and job-creation.

Consider this remarkable statistic. Between 2008 and 2016, the Toronto and Ottawa metropolitan areas were responsible for 98.6 per cent of all net job growth in the province. This means most other parts of the province struggled or experienced a tepid recovery from the brutal 2008/09 recession, which is bad news for many Ontarians and their families. Ontario has seen more than its share of economic pain over the past 15 years, but the evidence clearly shows the pain has not been spread evenly.

Consider southwestern Ontario, a region that includes large cities such as London and Windsor. Southwestern Ontario is not just a significant region of Ontario, it’s a significant region of Canada. Indeed, returning to the theme of our recent study, the region’s population is almost identical to that of the three Maritime provinces.

Given its size, if southwestern Ontario isn’t reaching its full potential, neither is Ontario or Canada. And yet the economic recovery from the recession was long delayed and the people of the region still feel related negative economic effects. Consider that as of 2015, the number of people employed in the region had not yet recovered to pre-recession levels.

Moreover, eastern and northern Ontario have also not yet recovered to pre-recession employment levels as of 2015.

In other words, although some metropolitan areas have started to recover, all of Ontario’s major regions outside the Toronto and Ottawa metropolitan areas have suffered some level of protracted post-recession economic pain.

Our analysis of Atlantic Canada’s economic performance helped underscore the fact our country can’t meet its full potential unless a large struggling region begins to reach its own potential. Similarly, Ontario mustn’t be so distracted by relatively good economic news and data from Toronto and Ottawa that we lose sight of the challenges elsewhere in the province in many towns and cities.

Given the vast population of Ontario and its various regions, it’s crucial that governments recognize and seek solutions to problems in struggling regions, for the sake of Ontarians and their families, the province and indeed the entire country.

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