Vaccines Spur Recovery Hopes: Ontario’s Two-Year Outlook—April 2021

The Conference Board of Canada, 16 pages, April 15, 2021
Issue briefing
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This quarterly economic forecast for the province of Ontario examines the economic outlook for the province, including gross domestic product (GDP), output by industry and labour market conditions.

Document Highlights

  • Real GDP in Ontario will advance by 4.5 per cent in 2021 and 3.5 per cent in 2022, following a 5.5 per cent drop in 2020.
  • The third wave of the COVID pandemic could prompt further lockdowns and represents a significant forecast risk. Ontario cases have soared and include the newer, more virulent strains of the virus.
  • Economic indicators for the first quarter are mixed, pointing to tepid growth. Many industries continue to struggle with COVID-related issues.
    Government programs have supported household incomes, but much of that income has gone into savings. This could sharply boost household spending over the next year.
  • Ontario’s housing markets are red hot. Accelerating price growth increases the risk of a correction.
  • Business investment will rebound in 2021, fuelled by new residential spending and resumed outlays on machinery and equipment.
  • Growth in Ontario’s population will approach its 10-year average in 2023–25 after a brief lull in 2021–22.

Table of Contents

  • Key findings
  • Ontario snapshot
  • Hope for Ontario's economic recovery
  • Housing markets ignore pandemic
  • Vaccine rollouts suggest economic improvement ahead
  • Last year's savings will boost this year's consumption
  • Investment poised for recovery
  • Government spends now, but a reckoning awaits
  • Weak outlook for trade
  • Methodology

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