MEDIA RELEASE
FOR IMMEDIATE RELEASE
Ontario’s outlook dampened by labour shortages, supply chain issues
(GREATER SUDBURY – February 3, 2022) – Pain points throughout Ontario’s economy are impairing business operations, and now consumers are feeling the pinch too. The frustration is palpable. From the grocery store and trucking industry to their pocketbooks, Ontarians are experiencing the very real consequences of labour shortages, global supply chain disruptions, and inflation. Today, the Greater Sudbury Chamber of Commerce and the Ontario Chamber of Commerce (OCC) released the sixth annual Ontario Economic Report (OER) providing regional and sector-specific data on business confidence, policy priorities, and economic indicators, which together provide a unique view on the hurdles ahead.
“Ontario began to see some positive momentum in 2021 thanks to progress on vaccines and reopening. Business confidence, GDP, and employment growth are trending upwards after record lows in 2020. However, the road ahead remains uncertain for businesses and households as labour shortages, supply chain disruptions, and inflation are hitting home,” said Rocco Rossi, President and CEO, Ontario Chamber of Commerce. “A staggering 62 per cent of sectors are facing labour shortages in Ontario and expect to continue facing them over the next year. This is having real-life consequences on the cost of living, service delivery, and product availability.”
“Our small business members in Greater Sudbury have proven their strength and resilience over the past two years. Business confidence is rising across the province but for many the additional strain on operations as a result of new variants and additional restrictions continues to dampen their recovery,” said Neil Milner, Board Chair, the Greater Sudbury Chamber of Commerce.
This year’s OER reveals the impacts of the pandemic continue to disproportionately impact small businesses, organizations led by women and people with disabilities, with the hardest-hit sectors being businesses in the arts, entertainment, and agricultural sectors.
“We are seeing a domino effect of structural issues. Jobs are going unfilled, demand is outpacing capacity, and these issues are driving up prices for consumers and uncertainty for businesses,” said the report’s co-author, Claudia Dessanti, Senior Manager, Policy, Ontario Chamber of Commerce. “Two years into the pandemic, there is light at the end of the tunnel, but we need a long-term plan that will provide stability and lay the groundwork for economic growth.”
Key highlights of the report include:
- Most of Northern Ontario continued to see declines in population last year and is projected to see a meager 0.1 per cent increase in 2022. Part of this may be the result of inadequate broadband, which is an important driver of intra-provincial migration thanks to the pandemic’s push towards digital adoption and work from home.
- All regions of Ontario, except Northeastern Ontario, saw positive employment growth in 2021, though several regions have yet to offset the major job losses seen during the first year of the pandemic.
- Overall, 29 per cent of Ontario businesses are confident in Ontario’s economic outlook in 2021 (compared to 21 per cent the year prior), and 57 per cent are confident in the outlook of their own organizations (up from 48 per cent).
- Most sectors (62 per cent) are facing labour shortages and expect to continue facing them over the next year.
- Inflation of raw materials and transportation costs at the producer level are affecting consumer prices, which rose 3.5 per cent and are expected to rise another 3.5 per cent in 2022. Ontario’s year-over-year housing price growth was above 30 per cent in December 2021.
- Small businesses are more preoccupied with cost relief measures such as business taxes and electricity rates, while larger businesses are more focused on long-term infrastructure, regulatory, and workforce development issues.
The sixth annual OER offers unique insights into business perspectives across Ontario. The report is driven by data from our annual Business Confidence Survey (BCS) and economic forecasts for the year ahead. The BCS was conducted online from October 6 to November 19, 2021, attracting responses from 1,513 organizations across Ontario. The OER was made possible by our Landmark Partner, Hydro One, and Research Partners, Golfdale Consulting and Bank of Montreal.
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About the Ontario Economic Report:
The Ontario Economic Report (OER) is the landmark research platform of the Ontario Chamber of Commerce (OCC), offering a unique perspective on the experience of businesses of all sizes across the province. The OER is a data-driven, evidence-based document rooted in the OCC’s annual survey of its members, the Business Confidence Survey (BCS).
For more information, please contact:
Gurkirat Bal
Advocacy and Communications Coordinator
Greater Sudbury Chamber of Commerce
705-673-7133 ext. 210
gurkirat(at)sudburychamber(dot)ca
The Greater Sudbury Chamber of Commerce represents 700 businesses employing in excess of 27,000 employees and works on behalf of its members to influence municipal, provincial and federal legislation affecting the business community.
BACKGROUNDER
For immediate release
2022 ONTARIO ECONOMIC REPORT KEY FINDINGS – BACKGROUNDER
(GREATER SUDBURY – February 3, 2022) –Today, the Greater Sudbury Chamber of Commerce and the Ontario Chamber of Commerce (OCC) released the sixth annual Ontario Economic Report (OER) providing regional and sector-specific data on business confidence, policy priorities, and economic indicators, which together provide a unique view on the hurdles ahead.
Key highlights from the OER include:
- In 2021, Northeastern Ontario had a jobless rate of 7 per cent which is expected to decline to 5.6 per cent in 2022.
- Northeastern Ontario’s businesses are slightly more confident in Ontario’s economic outlook then they were a year ago. In fall 2021, 28 per cent respondents said they were confident as compared to 24 per cent in fall 2020.
- Businesses’ confidence in their own organizations’ outlook have also increased in Northeastern Ontario. In fall 2021, 61 per cent businesses said they are confident as compared to 49 per cent in fall 2020.
- 53 per cent of Northeastern Ontario businesses are positive that entrepreneurship in the province will rebound from the COVID-19 pandemic.
- 54 per cent of Northeastern Ontario businesses said they are experiencing a labour shortage.
- Looking ahead, businesses are primarily looking for support with their operating costs. The two most popular priorities are a reduction or simplification in business taxes (55 per cent) and a reduction in electricity costs (53 per cent). Digital infrastructure and technology are also top of mind, as is encouraging Ontarians to travel and buy locally.
- Most sectors (62 per cent) faced labour shortages and expect to continue facing them over the next year.
- Despite signs of economic recovery midway through 2021, total business investment in Ontario decreased by -6.0 per cent in Q3.
- This downward trend was driven by several challenges including labour shortages, supply chain constraints and, inflation.
- Consumer spending drove the majority of economic growth in the latter half of 2021, a large portion of which involved spending over the summer on recreation, tourism, air travel, food and accommodation, as well as personal grooming.
- An above-average savings rate amongst Ontarians is driving further economic activity.
- Beyond real estate, households will continue to feel the effects of inflation in 2022. Recent forecasts estimate food prices will grow anywhere between 5 to 7 percent in the year ahead.
- Unlike inflation on accommodations, airfares, and natural gas, there are broader social and economic risks to consider if current prices for essential goods such as food, produce, and housing become permanent as opposed to transitory.
- Inflation of raw materials and transportation costs at the producer level are affected consumer prices, which rose 3.5 per cent and are expected to rise another 3.5 per cent in 2022. Ontario’s year-over-year housing price growth was above 30 percent in December 2021.
The complete report can be accessed on Ontario Chamber of Commerce’s website: www.occ.ca
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For more information, please contact:
Gurkirat Bal
Advocacy and Communications Coordinator
Greater Sudbury Chamber of Commerce
705-673-7133 ext. 210
gurkirat(at)sudburychamber(dot)ca
The Greater Sudbury Chamber of Commerce represents 700 businesses employing in excess of 27,000 employees and works on behalf of its members to influence municipal, provincial and federal legislation affecting the business community.
Download the media release here.