After a burst of activity in the summer, Ontario’s economy’s recovery has settled down and will not see pre-pandemic levels of activity until 2022, according to an economic analysis report from Central 1.
After an initial burst in activity when COVID-19 protocols were eased in summer, the Ontario economy has settled down and will not see pre-pandemic levels of activity until early to mid-2022, according to a report by Central 1.
In Central 1’s latest Ontario Economic Analysis, regional economist Edgard Navarrete notes, “Annual real gross domestic product (GDP) is forecast to decline six per cent in 2020, followed by growth of 4.4 per cent in 2021. Economic output is not expected to return to 2019 levels until mid-to-late 2022 with real GDP forecast to grow by 2.7 per cent in 2022 and 1.8 per cent in 2023.”
In 2020, annual average employment growth will decline 5.2 per cent contributing to a predicted unemployment rate of 9.8 per cent. Navarrete suggests the Ontario economy will be impacted not only by significant labour market uncertainty, but also by continued public health policies, travel restrictions, increased savings by households, and the absence of a widely available COVID-19 vaccine.
“We anticipate an effective vaccine to be made available by early 2021, but deployment lags will mean a slow road back for the economy,” said Navarrete.
“Current public health directives such as mask wearing, physical distancing, and controls on congregation sizes could possibly continue for most of 2021 and points to ongoing struggles for businesses and the likelihood of more permanent closures,” he added.
Not all services-sectors will fare poorly in 2020, he notes.
“Those able to pivot to online or towards remote work to protect their employees such as professional and scientific services, finance, and health will continue to remain relatively unscathed and face shallower losses,” said Navarrete.
Central 1 Credit Union provides liquidity management and investment services. The Company offers services including, commercial lending, payments, advisory, residential mortgage securitization, marketing consulting, retirement income funds, and managing the pooled liquidity of its member credit unions. Central 1 Credit Union operates throughout Canada.
