Ontario’s ‘recovery’ claims ignore lingering pain

Rosy rhetoric in economic statement just tells story of Greater Golden Horseshoe

Reading Time: 3 minutes

By Ben Eisen
and Joel Emes
The Fraser Institute

It’s no secret Ontario has experienced economic pain in recent years. The pain, however, has not been spread evenly, with some regions of the province 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.”

Ben Eisen
Ben
Eisen

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. Unfortunately, few at Queen’s Park seem to notice.

Let’s start with Southwestern Ontario. Once Canada’s industrial heartland, it is widely known the region was hit hard by the 2008/09 recession. What is perhaps less understood is that the region’s economic performance since the 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 one-third of the provincewide average, and is an extremely weak recovery considering the severity of the recession in the region.

Joel Emes
Joel Emes

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.

By 2015, six years removed from the recession, neither Southwestern, Northern nor Eastern Ontario had recovered to 2008 employment levels.

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 these facts before putting out any more tone-deaf press releases touting the Ontario’s economic performance and bragging about the success of its economic policies.

Ben Eisen and Joel Emes are analysts at the Fraser Institute.

Ben and Joel are Troy Media Thought Leaders. Why aren’t you?

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ontario recovery

The views, opinions and positions expressed by columnists and contributors are the author’s alone. They do not inherently or expressly reflect the views, opinions and/or positions of our publication.

Ben Eisen

Ben Eisen is a Senior Fellow in Fiscal and Provincial Prosperity Studies and former Director of Provincial Prosperity Studies at the Fraser Institute. He holds a BA from the University of Toronto and an MPP from the University of Toronto’s School of Public Policy and Governance. Prior to joining the Fraser Institute Mr. Eisen was the Director of Research and Programmes at the Atlantic Institute for Market Studies in Halifax. He also worked for the Citizens Budget Commission in New York City, and in Winnipeg as the Assistant Research Director for the Frontier Centre for Public Policy. Mr. Eisen has published influential studies on several policy topics, including intergovernmental relations, public finance, and higher education policy.

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