High inflation, interest rates and housing costs continue to drive pessimism in Ontario’s economic outlook, according to the Ontario Chamber of Commerce’s (OCC) eighth annual Ontario Economic Report (OER). Despite this, many businesses surveyed remain confident in their own outlooks, with 53 percent expecting to grow.
“Business confidence in the economy has plunged from 29 percent at the height of the pandemic to just 13 percent two years later – driven by the rising costs of living and of doing business,” said Daniel Tisch, President and CEO of the OCC. “There are bright spots – particularly in growth sectors such as mining – thanks to strategic investments, population growth and improved labour market resilience. In 2024 and beyond, productivity must be our priority.”
The OER contains regional and sector-specific data on business confidence and growth, public policy priorities, regional forecasts, and timely business issues such as supply chains, employee well-being, diversity, equity and inclusion, economic reconciliation, and climate change.
“Businesses across Thunder Bay are being faced with inflationary pressures, changes in consumer spending, and labour challenges, which are hampering their growth and recovery.” said Charla Robinson, President of the Thunder Bay Chamber of Commerce. “This underscores the critical need for government to implement targeted and strategic measures to support businesses through policies such as tax reforms, buy local programs, workforce development and affordable housing.”
Outlook highlights:
• Small businesses are less confident (12 percent) than larger businesses (22 percent) due to challenges with repaying debt, fluctuations in consumer spending, inflationary pressures, and workforce-related challenges such as mental health.
• Simplifying business taxes is identified as a major policy priority of 50 percent of surveyed businesses.
• Confidence in Ontario’s economic outlook varies considerably across industries and is lowest within the agriculture sector (3 percent), non-profit (8 percent), health care and social assistance (8 percent), and retail (10 percent) sectors.
• Confidence is highest in the province’s mining (46 percent) and utilities (27 percent) industries, both of which benefited from strong growth and investments in the province’s electrification infrastructure and electric vehicle supply chains.
• Businesses in Northeast and Northwest Ontario exhibit the highest confidence at 23 percent, where the mining industry is a major employer.
This year’s report was made possible by the OCC’s lead partner, Hydro One, presenting partner, Bruce Power, and research partners, Golfdale Consulting and BMO. Read the report.
Watch the report launch presentation to the Empire Club of Canada
