A recent report by the Fraser Institute has labeled Ontario as an 'economic laggard' within Canada, revealing concerning trends in its economic performance. From 2000 to 2022, Ontario's average annual real per-capita GDP growth was only 0.7%, significantly lower than the Canadian average of 1.3% and Quebec's 1.2%. This decline has caused Ontario's GDP per person to drop from the second-highest in the country to fifth place [1c9cf03a].
The report also highlights that Ontario has run annual deficits 19 times, which accounts for 80% of the period analyzed, compared to Quebec's 14 times, or 60%. Furthermore, Ontario's net government debt-to-GDP ratio has escalated from 25.6% in 2005 to 36.5% in 2022, raising alarms about fiscal management [1c9cf03a].
Low productivity has emerged as a critical issue, with Canadian productivity levels plummeting from 88% of U.S. levels in 1984 to just 71% in 2022. Finance Minister Chrystia Freeland has identified this decline in productivity as the 'Achilles heel' of the Canadian economy, emphasizing the need for urgent reforms [1c9cf03a].
In the context of the broader Canadian economy, Ontario's struggles are particularly stark against the backdrop of a projected 6% growth in Canada’s economy over the past five years, while the U.S. economy is expected to grow by 11% during the same period. This disparity could see Canada's per capita national income fall to about 70% of the U.S. figure by 2025 [51eb8231].
The economic outlook for Ontario raises concerns about its competitiveness and ability to attract investment, especially as provinces like Quebec show stronger economic resilience. As the situation evolves, the implications for Ontario's workforce and overall economic health will be closely monitored [1c9cf03a].