Environmental Scan - Ontario: 2021

Ontario Environmental Scan 2021
Ontario Environmental Scan 2021
Image transcript



  • 2 million people lived in Ontario in 2021, an increase of 5.8% from 2016 to 2021. Ontario represents 38.5% of Canada’s total population.
  • The proportion of seniors aged 65+ is projected to increase from 18.5% in 2021 to 22.5% in 2031. This will increase demand for the Canada Pension Plan (CPP) and Old Age Security (OAS) programs.
  • In 2021, individuals aged 55 and over accounted for 38.8% of the working-age population. By 2031, that proportion could reach 40%.
  • The proportion of youth (15-29) in Ontario is projected to decline slightly from 18.8% in 2021 to 18.6% in 2031.
  • A high number of youth work in environments that prevent teleworking, such as frontline retail.
  • Average age of the non-Indigenous population in Ontario is 40.7 versus 33.6 in the Indigenous population (2016 Census).
  • The Indigenous population comprises 2.8% of the total Ontario population (2016 Census), and continues to be under-represented in the labour market, accounting for 2.2% of the total Ontario labour force as of 2020. The geographic isolation of many Indigenous communities has heightened the impact of COVID-19 on Indigenous peoples, particularly in terms of access to health care.
  • Ontario has the largest proportion of immigrants arriving in Canada, with 39.0% of recent immigrants who arrived between 2011 and 2016. Newcomers to Ontario have been concerned with health-related issues, employment and finance issues, and education issues due to the COVID-19 pandemic.
  • The official-language minority community in Ontario represents 4.1% of the provincial population (2016 Census), and is prevalent mostly in the Northeast Ontario and Ottawa economic regions.
  • In 2017, 24.1% of the Ontario population aged 15 and over were persons with disabilities, defined as persons who report a limitation in their day-to-day activities. The 2017 Canadian Survey on Disability revealed wide differences in income and employment outcomes of those persons with disabilities when compared with the rest of the population.


  • In 2021…
    • Employment recovered significantly (+4.9%)
    • Unemployment fell, but still above 2019 levels (-14.0%)
    • Participation rate recovered (63.6% to 64.9%)
    • Employment rate increased (57.5% to 59.7%)
  • Ontario’s Unemployment Rate
    • The provincial unemployment rate fell from 9.6% in 2020 to 8.0% in 2021, as the Ontario labour market began recovering and adapting to the various challenges brought on by the COVID-19 pandemic.
  • In 2022…
    • As the economy gradually recovers from the widespread impact of the COVID-19 pandemic, employment in Ontario is projected to expand by about 3.5% in 2022, and to increase further by about 2% in 2023.
    • In addition, the unemployment rate in Ontario is projected to fall to about 6.3% in 2022, and then to drop further to about 5.7% in 2023.


Ontario’s Economic Drivers in 2021

  • Government expenditures providing pandemic-related support
  • Growing consumer and business confidence
  • Expanding investment in residential structures

Reviewing 2021

  • Public health measures and restrictions accompanied various waves of the COVID-19 pandemic in Ontario, leading to significant federal & provincial government support in 2021.
  • Economic activity rebounded in 2021 in Ontario, as consumer and business confidence grew through the year. Investment flowed into numerous sectors, notably into residential construction and renovation.
  • Inflation rates reached historic highs, driven by supply chain and labour shortage issues. Pent-up consumer savings, elevated demand for goods and services, and government spending are also contributing factors.
  • Real GDP fell by 5.1% in 2020, but is forecast to grow by about 4.4% in Ontario over 2021, and similarly in 2022. However, risks to the Ontario economy remain due to the unpredictable nature of the pandemic.

Risks to the Ontario Economy in 2022

  • Uncertainty of possible restrictions in response to the ongoing COVID-19 pandemic, resulting in labour shortages, lower production, business layoffs and/or closures.
  • Greater digitalization and physical distancing measures, primarily affecting tourism and travel, accommodation and food services, education, and retail trade
  • Elevated household debt levels affected by increases in interest rates to counter high inflation rates

Wages and Low-Income Populations

  • The COVID-19 pandemic has accelerated workplace trends such as telework or work-from-home
  • Low-income individuals have experienced increased financial hardships in the pandemic-affected labour market, due to the high concentration of these workers in the industries and occupations most affected by the guidelines aimed at mitigating the pandemic

Small-Medium Enterprises (SMEs)

  • Small and medium enterprises have been hit particularly hard by the economic impacts of the COVID-19 pandemic, as lower saving reserves compared to large enterprises has put SMEs at greater risk of not being able to endure temporary lockdown orders
  • Small enterprises (1-99 employees) represent 97.9% of businesses with at least one employee in Ontario,[i] and employ 35.6% of employees in Ontario as of 2020
  • Medium enterprises (100-499 employees) represent 1.9% of businesses with at least one employee in Ontario, and employ 15.8% of employees in Ontario as of 2020
  • Large enterprises (500+ employees) represent 0.3% of businesses with at least one employee in Ontario, and employ 48.6% of employees in Ontario as of 2020

Industry Trends

  • Employment gains were recorded in the majority of the industries in Ontario in 2021, recovering from the nearly universal employment losses across all sectors in 2020.
  • Information, culture and recreation (+11.7%) and professional, scientific and technical services (+11.1%) had the sharpest growths among sectors in Ontario, as film production picked up again, and IT-related employment went from strength to strength even through the pandemic.
  • Agriculture (-6.1%) endured a 2nd consecutive year of employment losses in Ontario, as workforce levels in the sector continued its downward trend.
  • Employment increased in both the goods (+4.0%) and services-producing (+5.2%) sectors in 2021 in Ontario.

Regional Economic Conditions

  • Employment levels grew in all but one economic region in Ontario in 2021.
  • Windsor-Sarnia (+10.5%) observed the sharpest employment growth among Ontario regions, reversing the trend from the previous year when the region had the steepest employment decline among all regions in Ontario.
  • Northeast Ontario was the only region in Ontario where employment fell for 2021. The regional labour market saw workforce decreases in its trade and health care sectors.
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