Ontario’s economic pain is spread unevenly around the province

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Appeared in the Toronto Sun, December 2, 2016

It’s no secret Ontario has experienced economic pain in recent years. This pain, however, has not been spread evenly. While the province’s overall economic performance has been nothing to write home about, some regions of the province have been hit harder than others.

Recently, Ontario’s provincial government released its fall economic statement, which pointed to Ontario’s uptick in economic growth over the past year as evidence that the Wynne government’s economic “plan is working.”

The government’s rosy rhetoric felt out-of-touch with the experience of many Ontarians who are struggling to cope with high electricity prices and the ongoing consequences of more than a decade of anemic economic growth. This is especially true in certain regions of the province.

While the Greater Golden Horseshoe and Ottawa have done comparatively well since the recession, the rest of Ontario has barely experienced any economic recovery at all. Unfortunately, few at Queen’s Park seem to notice.

Let’s start with Southwestern Ontario. Once Canada’s industrial heartland, it’s widely known the region was hit hard by the 2008/09 recession. What is perhaps less understood is that the region’s economic “recovery” since that recession has been tepid, to say the least. In fact, between 2010 and 2015, total employment grew at an average annual rate of just 0.4 per cent. That’s about a third of the provincewide average, and is an extremely weak recovery considering the severity of the recession in the region.

As bad as that sounds, though, job numbers are even grimmer in both Eastern and Northern Ontario, where employment actually shrank during the 2010-2015 period.

These data show that in much of Ontario, job-creation has been virtually non-existent since the recession. Outside the Greater Golden Horseshoe, average annual employment growth from 2010 to 2015 was just 0.2 per cent. In other words, there has been almost no employment growth in Ontario outside the Golden Horseshoe during the province’s “recovery.”

As a result of this weak recovery, by 2015, six years removed from the recession, neither Southwestern, Northern nor Eastern Ontario had recovered to 2008 employment levels.

To be clear, even when you factor in the Golden Horseshoe, Ontario’s overall economic performance in recent years has been weak. But the full extent of economic pain felt in large chunks of Ontario can be missed if you look only at provincial-level economic statistics, which are so heavily influenced by the populous Golden Horseshoe, and specifically the metropolis of Toronto, where job-growth has been somewhat stronger.

In reality, it will take more than a few fiscal quarters, or even a few years of strong economic growth, to repair the economic damage, particularly in the hardest hit regions of the province. The Wynne government should consider this fact before putting out any more tone-deaf press releases touting the Ontario’s economic performance and bragging about the success of its economic policies.

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