The Port Hope and District Chamber of Commerce has shared the Ontario Chamber of Commerce's fifth annual Ontario Economic Report, providing the latest data on Ontario’s economy and business confidence at the end of an unprecedented year, with a look at the unpredictability that lies ahead in 2021,
Ontario Chamber of Commerce President and Chief Executive Officer Rocco Rossi commented on the considerable negative impact on the economy that resulted from the continuing health and economic crises.
“Only 21% of businesses are confident in Ontario’s economic outlook – a historic low – reflecting the stark reality in which businesses continue to grapple with the financial and logistical challenges of operating under a pandemic,” Rossi said.
The newly issued report 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 faces in the year ahead.
“Port Hope depends on small businesses as the backbone of our economy and lifeblood of our community,” Port Hope and District Chamber of Commerce Chief Executive Officer Brenda Whitehead said in the press release.
“Small-business members are the least confident in the province’s economy, as they continue to face liquidity constraints, increased costs, and reduced revenues.
“The Ontario Economic Report includes the reality that the hardest-hit sectors were those requiring considerable face-to-face contact. Those that we have many of in our community: accommodation and food services; arts, entertainment and recreation; and retail.
“It also reveals that employment growth declined throughout the province with women, lower-income, racialized, new immigrant and younger Ontarians suffering the biggest job losses,” Whitehead added.
“There is not a region in the province that have not felt the impacts, though some considerably more than others. 2021 will be a year filled with challenge as we continue to fight and try to bounce back.”
The press release added the comment of report co-author Daniel Safayeni (Acting Vice President of Policy at the OCC).
“No business, region, sector or demographic should be left behind in the pursuit of economic recovery and growth,” Safayeni urged.
“Support programs and pro-growth policies should be targeted towards those experiencing the most pronounced challenges. A focus on reskilling as well as widespread access to broadband infrastructure and capital will be necessary to the revival of small business and entrepreneurship as well as an inclusive and robust economic recovery.”
The announcement set out key highlights from the report.
Ontario witnessed a steep decline in real GDP growth (-5.6%) in 2020, but is projected to see a moderate rebound of 4.8% in 2021, fueled to a significant degree by expectations for vaccination rollout and the eventual reopening of the economy.
In 2020, only 21% of survey respondents expressed confidence in Ontario’s economic outlook. Fewer than half of Ontario businesses (48%) are confident in the outlook of their own organizations over the next year.
Small businesses are more pessimistic about Ontario’s outlook than larger ones. Only 20% of small businesses expressed confidence in Ontario’s economy, compared to 27% of medium and large businesses.
The majority (58%) of survey respondents said their organizations had shrunk between April and September, while only 17% grew.
Employment growth declined throughout the province in 2020, with 47% 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.
“The prolonged nature of the crisis, rising case counts and uncertainty around vaccine deployment timelines have taken a toll on employers and Ontarians across the province. Yet, Ontario has a proven track record of resilience and recovery,” Rossi concluded.
“Our long-term prosperity will depend on all levels of government working together towards economic recovery.”
