The Ontario Chamber of Commerce (OCC), in partnership with the Ontario Chamber Network, released its fifth annual Ontario Economic Report (OER). The report provides the latest data on Ontario’s economy and business confidence, highlighting the unprecedented year that was 2020 and the unpredictability that lies in the year ahead.
The OER is a data-driven, evidence-based document rooted in the OCC’s annual survey of its members, the Business Confidence Survey (BCS). The BCS illuminates trends in economic activity and provides a grassroots perspective of how Ontario businesses feel about the economic outlook of the province and their organizations.
The 2021 OER uncovers the disproportionate impact of COVID-19 on small businesses and entrepreneurs as well as specific regions, sectors, and demographics, highlighting the major vulnerabilities and opportunities Ontario will face in the year ahead. The report’s findings indicate that employment growth declined throughout the province with women, lower-income, racialized, new immigrant, and younger Ontarians suffering the biggest job losses. Every region of the province felt the impacts of the recession, though some considerably more than others.
Key highlights of the report include:
- Ontario witnessed a steep decline in real GDP growth (-5.6 percent) in 2020 but is projected to see a moderate rebound of 4.8 percent in 2021, fuelled largely in part by expectations for vaccination rollout and the eventual re-opening of the economy.
- In 2020, only 21 percent of survey respondents expressed confidence in Ontario’s economic outlook. Fewer than half of Ontario businesses (48 percent) are confident in the outlook of their own organizations.
- Small businesses are more pessimistic about Ontario’s outlook than larger ones. Only 20 percent of small businesses expressed confidence in Ontario’s economy, compared to 27 percent of medium and large businesses.
- The majority (58 percent) of survey respondents said their organizations shrank between April and September, while only 17 percent grew.
- Employment growth declined throughout the province in 2020, with 47 percent of organizations indicating they let employees go due to COVID-19.
- Sectors most negatively impacted by the crisis included: accommodation and food services; arts, entertainment, and recreation; and retail. Businesses in these sectors were among those most pessimistic about the economic outlook and most likely to have shrunk and let go of staff in 2020.
- Businesses’ priorities for governments during economic recovery included enhancing access to capital, reforming business taxes, encouraging Ontarians to buy local, and investing in broadband infrastructure.
Key highlights for Northeastern Ontario:
- Only 24 percent of respondents were confident in Ontario’s economic outlook (higher than the provincial average) whereas 49 percent of respondents felt very confident in their own organizational outlook (also higher than the provincial average).
- 60 percent of respondents said Northeastern Ontario, as a region, provided their business with enough economic opportunity to thrive, which ranked sixth among Ontario’s regions.
- Northeastern Ontario saw a 2.4 percent decline in employment rate in 2020 and is projected to see employment growth of 2.5 percent in 2021.
- In 2020, 19 percent of Northeastern companies grew, 50 percent shrunk and 32 percent stayed the same.
The report was released through an online event that saw opening remarks from Hon. Victor Fedeli, Ontario’s Minister of Economic Development, Job Creation and Trade, and a fireside chat with Mark Poweska, President and CEO of Hydro One, and Rocco Rossi, President and CEO of the OCC.
Read the full 2021 Ontario Economic Report HERE.