February 9, 2021
Review of ICI Investment in Ontario in 2020
Yesterday, Statistics Canada released its Investment in Building Construction data for December, which shows that ICI investment activity in Ontario ended 2020 in much the same way as 2019. ICI investment in December was down by 0.3% compared to December 2019, while Q4 2020 ICI investment was down 0.2% compared to Q4 2019. This consistency exemplifies the relative stability of investment data over the past year. Other than a drop-off in April, and record high in June, ICI investment has been fairly durable through the pandemic disruptions. Investment numbers have been particularly stable relative to building permit data, which was plagued by erratic month-to-month fluctuations in 2020, particularly at the metro-level.
ICI investment in Ontario increased by 5.5% in 2020 over 2019. Institutional sector investment in the province increased by 3.0% in 2020, while commercial investment grew by 8.7%. Statistics Canada notes that the rise in commercial investment in Ontario is partially due to large projects like Amazon’s Python Project in Ottawa. Ontario’s industrial sector investment fell by 0.6% compared to last year.
ICI investment rose in ten of Ontario’s sixteen metropolitan areas in 2020. The biggest increases came in Peterborough (+38.4%), Ottawa (+35.7%) due somewhat to the previously mentioned Amazon project, Guelph (+21.7%) and London (+17.5%). Similar levels of investment growth were experienced by St. Catharines-Niagara (+12.5%), Brantford (+11.6%) and Windsor (+11.2%). Single-digit increases were observed in Toronto (+6.1%), Oshawa (+4.5%) and Kitchener-Cambridge-Waterloo (+0.9%).
Thunder Bay (-3.4%) and Hamilton (-5.5%) had modest declines in investment in 2020. Investment fell by double-digits in Greater Sudbury (-12.4%), Belleville (-13.7%), Kingston (-16.4%) and Barrie (-35.6%).
Employment Numbers Fall Slightly in Ontario
Statistics Canada released its January Labour Force Survey on Friday, showing that Ontario’s construction industry employment fell by less than 1% over December. Construction employment in Ontario has been relatively stable in the past three months, fluctuating between 534,000 and 540,000 jobs. Compared to last January, employment in Ontario’s construction employment is down by 4.5% (about 25,000 jobs).
Ontario’s unemployment rate increased in January to its highest level since August. Unemployment reached 10.2% in January, up from 9.6% in December.
It should be noted for both the unemployment rate and the construction employment data that new workplace restrictions went into effect in Ontario on January 14th. The reference period for Statistics Canada’s Labour Force Survey is normally the week containing the 15th, so it is unlikely that this data captures the full impact of the new workplace restrictions.
GDP Increases Observed in the Latter Months of 2020
Statistics Canada also recently released GDP data for November 2020. Canada’s GDP increased by 0.7% in November over October, the seventh consecutive monthly increase. Relative to November 2019 however, Canada’s GDP was down 2.8%.
Ontario’s third-quarter GDP data from the Ministry of Finance recently indicated a 9.4% quarter-to-quarter increase after declining in the first and second quarters. Despite this increase, the Q3 GDP was still 5.7% lower than in the last quarter of 2019.
_____________________________
FOR MORE INFORMATION, CONTACT:
Katherine Jacobs
Director of Research
Ontario Construction Secretariat (OCS)
180 Attwell Drive, Suite 360, Toronto, ON M9W 6A9
P 416.620.5210 ext. 222
F 416.620.5310
kjacobs@iciconstruction.com
