March 23, 2023
ONTARIO ECONOMIC OUTLOOK
Despite high inflation and rising interest rates, Ontario’s economy has been resilient, with tight labour markets and a historically low unemployment rate. Slower growth is expected as we go further into 2023 and interest rate hikes funnel through the economy. However, the province’s fiscal position continues to improve, and the economy is projected to pick up speed in 2024.
Ontario projected a deficit of $2.2B in 2022-23, which is expected to further decrease to $1.3B in 2023-24. This is $17.7B lower than the deficit in the 2022 Budget and $4.4B lower than in the 2022-23 Third Quarter Finances. A $0.2B surplus is anticipated in 2024-25, increasing to $4.4B in 2025-26.
The net debt-to-GDP ratio is projected to be 37.8% in 2022-23 – the lowest level since 2011–12. Over the next few years, Ontario’s net debt-to-GDP ratio is forecast to be 37.8% in 2023-24, 37.7% in 2024–25, and declining to 36.9% in 2025–26.
Growth is expected to slow in 2023, with real GDP expected to grow by a flat 0.2% in 2023 (down from 3.7% in 2022). However, real GDP growth is expected to increase to 1.3% in 2024, 2.5% in 2025 and 2.4% in 2026.
“Ontario needs more skilled workers to tackle the province’s labour shortage, strengthen the economy and build a stronger workforce for everyone. To do this, the government continues to invest in skills training, transform the apprenticeship and skilled trades system, and help newcomers put their skills to use.”
- Investing $75M over the next three years into the Skills Development Fund
- Investing $224M over the next year into a new stream of the Skills Development Fund which would help build and upgrade training centres and union trading halls
- $25M over three years into the Ontario Immigrant Nominee Program to bring more skilled trades workers into Ontario
- $3M in Ontario Bridge Training Program to help immigrants get into the skilled trades
- Investing $3.5M over three years in the Abilities Centre in Whitby to help provide people with disabilities skills development
- Investing $3.5M in the Provincial Building and Construction Trades Council of Ontario to encourage more students to select careers in the skilled trades
To keep the economy strong and to help support the increasing population, the government is continuing to support a variety of infrastructure projects. Listed below are some of the major projects detailed in the “Building Ontario” section of the budget.
Ring of Fire
- Investing nearly $1B to develop infrastructure in the Ring of Fire region, including roads, broadband, and community supports
Highways and Bridges
- $27.9B over the next 10 years ($3.2B in 2023) to create, expand, and repair highways and bridges
- Continuation of several highway projects including Highway 413, the Bradford Bypass and widening Highway 401 in Eastern Ontario, new Highway 7 between Kitchener and Guelph, and the QEW Skyway Garden Twinning project
Major Transit Projects
- $184.4B over next 10 years for highways, transit, and infrastructure, with $20.6B in the coming year
- $139.5M to help restore the Northlander passenger rail between Timmins and Toronto
- Transit Investment of about $70.5B over the next 10 years including Ontario Line, Scarborough Extension, Yonge North Subway Extension
- LRT projects, such as Hamilton LRT and Finch West LRT
In addition to the numerous transit projects, the government is partnering with municipalities and building partners to help create transit-friendly communities through the Transit-Oriented Communities program. Initiatives include sites at future stations along new lines, such as the East Harbour Transit Hub. The site will include new residential and commercial space.
- Committing $48B over the next 10 years for hospital infrastructure, including $32B towards over 50 hospital projectsthat will add 3,000 beds over the next 10 years
- $6.4B for 31,000 new and 28,000 upgraded LTC beds
- Projects scheduled for completion in 2023 include: Queensway Carleton Hospital – Mental Health Redevelopment (Nov 2023), Dave Smith Youth Treatment Centre – Phase 2 Redevelopment (Nov 2023), and the Brock Community Health Centre (Dec 2023).
Schools and Child Care
- $15B in grants to develop schools and daycare spaces
For a complete copy of the 2023 Ontario Budget: Building a Strong Ontario, Click Here