: Ontario Economic Accounts

Third Quarter of 2020
(July, August, September)
Ontario Ministry of Finance

Table of Contents

ECONOMIC ACCOUNTS

RECENT ECONOMIC DEVELOPMENTS

Economic Accounts

Highlights

Ontario Economy Grows in Q3

Ontario’s real gross domestic product (GDP) increased 9.4% in the third quarter (July, August, September) of 2020 with robust growth across all major expenditure categories. This followed two consecutive quarterly declines. Real GDP in the quarter was 5.7% below the 2019Q4 level.

Nominal GDP advanced 11.8% in the third quarter, driven by an 8.3% increase in the compensation of employees along with a 21.3% increase in the net operating surplus of corporations.

Economic production measured on an industry basis increased by 9.7%, following a decline of 12.0% in the second quarter. Goods sector output advanced by 15.6%, while output in service-producing industries grew by 8.3%.


Expenditure Details

Real GDP Up in Q3

Ontario’s real GDP rose 9.4% in the third quarter, reflecting strong gains in household spending, business investment and exports.

Household consumption spending rebounded 13.6%, after declining 14.3% in the second quarter. Consumer spending on durable goods increased by 41.3%, largely reflecting motor vehicle purchases. Household spending on semi-durable goods also rebounded, rising by 33.4%, while spending on services (+9.9%) and non-durable goods (+4.5%) also rose in the quarter.

Total business investment spending increased by 22.5%, led by strong gains in residential construction (+37.2%) and machinery and equipment (+18.4%). The rebound in residential investment was supported by a strong resumption in home resale activity.

Exports (+20.2%) and imports (+25.5%) both increased in the third quarter, led by trade in motor vehicles and parts. International trade was up sharply with exports (+26.6%) and imports (+30.4%) both advancing. Interprovincial trade also grew in the third quarter as exports (+9.0%) and imports (+12.1%) were higher.

Businesses drew down $13.4 billion worth of non-farm inventories in the third quarter.


Income Details

Nominal GDP Rises

Ontario’s nominal GDP increased 11.8% in the third quarter, after declining 13.0% in the second quarter.

Compensation of employees, which includes both wages and salaries and supplementary labour income, advanced 8.3%, after declining 8.5% in the second quarter.

Net operating surplus of corporations increased 21.3%, following a 17.2% decline in the second quarter.

Net mixed income, which is comprised of farm income, unincorporated business income and rental income, grew by 5.3%, after declining 4.8% in the previous quarter.

Ontario’s household saving rate declined to 13.4% in the third quarter, down from a record 26.2% in the second quarter. Despite the decline, the savings rate in the third quarter remained considerably above the long-run average.


Price Details

Economy-Wide Prices

Economy-wide prices, as measured by the implicit price index for GDP, increased by 2.2% in the third quarter, following a 0.9% decline in the previous quarter.

Prices for household consumption expenditures rose 1.0%, after declining 0.9% in the second quarter. Prices were higher for a number of expenditure components, including motor vehicles, clothing and gasoline.

Business investment prices increased by 3.8%, led by residential construction which rose 6.4%. Prices for both machinery and equipment (+2.8%) and non-residential construction (+0.3%) were also higher in the third quarter.

Export prices rose 1.9% in the third quarter, after declining 2.4% in the previous quarter, while import prices were little changed, edging down 0.1%, following a 1.9% decline in the second quarter.


Industry Details

GDP by Industry

Ontario real GDP, measured as value-added by industry, rebounded 9.7% in the third quarter of 2020. Output in both goods-producing (+15.6%) and service-producing (+8.3%) industries increased.

Manufacturing output increased 23.9% with widespread increases across sub-sectors. Transportation equipment (+98.9%) posted the largest increase, as assembly plants resumed production following temporary shutdowns due to COVID-19. Plastic and rubber products (+37.5%) also posted a notable increase in the quarter.

Construction output was 10.9% higher, as both residential (+17.1%) and non-residential structures and engineering (+6.5%) increased.

Primary industry output rose 1.3%, with increases in both agriculture and forestry (+1.3%) and mining (+1.4%).

Utilities output rose 1.6%, as both electric power (+1.5%) and natural gas, water and other utilities (+2.0%) increased.

Higher output in service-producing industries was driven by wholesale trade (+17.3%), retail trade (+20.4%), real estate, rental and leasing (+4.8%) and finance and insurance (+2.6).


Jurisdictional Comparisons

Ontario Growth in Context

Canadian GDP increased 8.9% in the third quarter of 2020, following a 11.3% decline in the previous quarter. Real GDP growth was driven by all the major components including household spending (+13.0%), business investment (+16.2%) and exports (+14.5%). As of the third quarter, Canada’s real GDP was 5.3% below the level in 2019Q4.

Quebec’s real GDP increased 12.6% in the third quarter, following a decline of 11.9% in the previous quarter. Real GDP growth was driven by household spending (+15.9%), business investment (+35.0%) and exports (+11.5%). As of the third quarter, Quebec’s real GDP was 3.5% below the level in 2019Q4.

In the U.S., real GDP increased 7.5% in the third quarter, after decreasing 9.0% in the second quarter. Household consumption (+9.0%), exports (+12.4%) and machinery and equipment investment (+13.9%) rebounded sharply in the quarter. As of the third quarter, U.S. GDP was 3.4% below in the level in 2019Q4.

Recent Economic Developments

Global Economic Developments

Global Economies Rebound

The reopening of global economies was evident in the third quarter as most countries reported strong GDP growth following record declines in the second quarter. Real GDP in the euro area increased 12.5% in the third quarter, after declining 11.7% in the second quarter. This included Germany, where real GDP expanded 8.5% and the United Kingdom where real GDP increased 16.0% in the third quarter. Japan’s real GDP increased 5.3%, following three consecutive quarterly declines. China’s economy continued to recover growing 2.7% in the third quarter after increasing 11.7% in the second quarter and declining 10.0% in the first quarter. Despite the strong third quarter gains, real GDP for most countries remained below pre-pandemic levels.

The U.S. economy expanded at its fastest pace on record in the third quarter, rising 7.5% following a 9.0% decline in the second quarter and a 1.3% decrease in the first quarter. Personal consumption spending increased 9.0% in the third quarter, driven by a 16.3% increase in consumption of durable goods, such as autos and household appliances. Exports increased 12.4%, while imports rose 17.9%.

U.S. employment rose a total of 12.3 million between May and November, recovering more than half of the 22.2 million jobs lost in March and April. As of November, the level of U.S. employment remained 6.5% lower than its February level. The unemployment rate continued to decline from the peak of 14.7% in April, to 6.7% in November.


Financial Markets Improve

Global oil demand increased in the second half of 2020 as economic growth rebounded sharply. West Texas Intermediate (WTI) oil traded around US$40 per barrel in September before rising to US$47 per barrel by mid-December. This is still below the average price of US$60 per barrel in December 2019.

The Canadian dollar strengthened further against the U.S. dollar through the second half of 2020 and traded around 78 cents U.S. in mid-December, slightly above pre-pandemic levels. Broad-based weakness in the US dollar, along with strengthening oil prices, supported Canadian dollar appreciation.

After modest weakening in late October, major stock indices trended higher in November and December. As of mid-December, the U.S. S&P 500 index was 7.7% above its February peak, while Canada’s S&P/TSX index was 3.1% below its February peak.

Major central banks continue to maintain low policy rates and quantitative easing in order to keep short- and long-term interest rates accommodative. The U.S. Federal Reserve maintained the target range for the federal funds rate at 0 to 0.25% and continued to increase its holdings of Treasury securities and agency mortgage-backed securities. In their December announcement, the Bank of Canada maintained its key policy interest rate at 0.25% and continued its quantitative easing at the pace of at least $4 billion per week.

Increased economic optimism has contributed to long-term government bond yields rising slightly in the fourth quarter. The Canadian 10-year government bond yield has edged up to 0.7% in mid-December from 0.6% in September.


Employment

Labour Market Rebound

Ontario’s employment advanced by 36,600 jobs in November, the sixth consecutive monthly gain. Since June, employment has risen by 905,200 jobs (+14.1%). As of November 2020, employment was 251,300 (−3.3%) below the February level.

The recovery in employment included increases in both full-time (+590,200) jobs and part time (+314,900) jobs.

Most of the increase in employment was in the private sector (+783,400). Public sector employment (+115,500) also increased, while self-employment (+6,300) edged up over the period.

There were notable employment increases in both service-producing (+686,200) and goods-producing (+219,000) industries since June. As of November, employment in both service-producing (−4.0%) and goods-producing (−0.7%) industries were below their February 2020 levels.

In November 2020, the unemployment rate was 9.1%, down from a high of 13.6% in May. Prior to the impact of COVID-19, Ontario’s unemployment rate was fluctuating around 5.5%, near a historic low.


Note: More information on Ontario labour market performance can be found in the Quarterly Ontario
Employment Report at: https://www.ontario.ca/document/ontario-employment-reports

Consumer and Business Activity

Sales and Trade Recovery

Retail sales declined by 0.4% in October, following five consecutive monthly increases. As of October, retail sales were 1.1% above the February 2020 level. Since their low in April, the recovery in retail sales was broad based, led by higher sales at motor vehicle and parts dealers.

Wholesale trade increased by 1.7% in October, after edging up by 0.3% in September. As of October, wholesale trade was 2.0% above the February level. Since the low in April, the recovery in wholesale trade was led by higher sales of motor vehicles and parts, followed by building materials and household goods.

Manufacturing sales edged up 0.2% in October, following an increase of 1.5% in September. As of October, sales were 2.2% below the February 2020 level. Since the low in April, the recovery in manufacturing sales was led by higher sales of transportation equipment.

Housing

Housing Market Overview

Sales of existing homes rebounded strongly from sharp declines in March and April. Although the pace of recovery has slowed in recent months, home resales as of November were 4.1% above the February level.

Ontario’s average home resale prices have been trending higher since May. In November, the average resale price of an Ontario home increased 1.9% to $745,854 and was 9.2% above the February level.

Housing starts increased 0.5% in November, following a 2.8% advance in October. On a year-to-date basis, urban area housing starts increased 15.9% in the first eleven months of 2020, compared to the same period in 2019. Both multiple-unit (+16.3%) and single-detached (+14.8%) starts rose over the period.


In Focus

Residential Investment Up Strongly in Q3

Residential investment is an important component of Ontario’s economy, accounting for about 8% of GDP in 2019.

Residential investment was significantly impacted early in 2020 by the COVID-19 pandemic, declining 16.4% in the second quarter. Rising strongly in the third quarter (+37.2%), residential investment was 14.8% above the level in the fourth quarter of 2019.

There are three components included in residential investment spending: new home construction, renovations to existing homes and ownership transfer costs.

Ownership transfer costs include fees associated with buying or selling homes, and therefore reflect the housing resale market. During the second quarter of 2020, transfer costs declined by 34.7% reflecting the significant decline in home resales. In the third quarter there was a strong rebound, as transfer costs rose by 103.2%, a major driver of the overall increase in total residential investment spending. As of the third quarter, ownership transfer costs were 35.5% above the 2019Q4 level.

New home construction of single- and multi-family homes, which decreased by 2.3% in the second quarter, rebounded by 13.9% in the third quarter. As of the third quarter, new home construction was 9.8% above the 2019Q4 level.

Renovation spending declined by 18.7% in the second quarter, followed by a 25.3% rebound in the third quarter of 2020. As of the third quarter, renovation spending was 2.1% above the 2019Q4 level.


Appendix

OEA Release Dates

The Fiscal Sustainability, Transparency and Accountability Act, 2019 states that the quarterly Ontario Economic Accounts should be released within 45 days of the Statistics Canada release of the National Income and Expenditure Accounts.

In compliance with the legislation, the OEA will be released according to the following schedule:

Reference Period Expected Statistics Canada release of National Income and Expenditure Accounts Corresponding deadline for the release of Ontario Economic Accounts (within 45 days of Statistics Canada release date)
Fourth Quarter
(October-December) 2020
March 2, 2021 By April 16, 2021
First Quarter
(January-March) 2021
June 1, 2021 By July 16, 2021
Second Quarter
(April-June) 2021
August 31, 2021 By October 15, 2021
Third Quarter
(July-September) 2021
November 30, 2021 By January 14, 2022
Fourth Quarter
(October-December) 2021
March 1, 2022 By April 15, 2022

Structure of the Ontario Economy

Per Cent Share of Nominal GDP, 2019
Note: Numbers may not add due to rounding.
Source: Statistics Canada
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How GDP is Measured

The Ontario Economic Accounts provide measurements of GDP using three different methodologies, by expenditure, income and industry.

The GDP by expenditure approach defines GDP as the aggregate of all expenditures on final consumption, gross capital formation and net trade by consumers, governments and businesses that occur within Ontario’s economy over a given time period. This measurement of GDP can also be defined as the sum of consumer spending, gross investment, government spending and net trade.

The GDP by income approach equates GDP to the total income earned through contributions to production within Ontario’s economy by labour and capital over a given time period. That is, GDP is the sum of all wages and salaries paid to employees, the gross operating surplus of businesses, gross mixed income and indirect taxes less subsidies.

The GDP by industry approach measures GDP by calculating the total output of the goods and services producing industries within Ontario’s economy and subtracting the cost of intermediate inputs used in final production. This approach can also be referred to as the value-added approach as it quantifies the additional value generated by industries through the production of final products within the economy.

For a full list of definitions used in the Ontario Economic Accounts, please see Statistics Canada’s System of Macroeconomic Accounts Glossary at https://www150.statcan.gc.ca/n1/pub/13-605-x/gloss/gloss-a-eng.htm.

List of Data Tables

Income and Expenditure Data

Quarterly Data, 2017:Q1–2020:Q3

Table 1: Ontario Gross Domestic Product (Income-Based)
Table 2: Ontario Gross Domestic Product (Expenditure-Based)
Table 3: Ontario Gross Domestic Product at Chained 2012 Prices
Table 4: Sources and Disposition of Ontario Household Income
Table 5: Ontario Trade
Table 6: Ontario Trade (Chained 2012 Prices)
Table 7: Ontario Deflators

Annual Data, 2016-2019

Table 8: Ontario Gross Domestic Product (Income-Based)
Table 9: Ontario Gross Domestic Product (Expenditure-Based)
Table 10: Ontario Gross Domestic Product at Chained 2012 Prices
Table 11: Sources and Disposition of Ontario Household Income
Table 12: Ontario Trade
Table 13: Ontario Trade (Chained 2012 Prices)
Table 14: Ontario Deflators

Ontario Production by Industry at 2012 Prices

Table 15: Quarterly Data, 2017:Q1-2020:Q3
Table 16: Annual Data, 2016-2019

Historical tables, both annual and quarterly available from 1981.
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Graphic Descriptions

Highlights: Ontario GDP, Third Quarter 2020

The chart indicates the per cent change in real and nominal GDP in the third quarter of 2020. Real GDP increased by 9.4% and nominal GDP increased 11.8% in the quarter.

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Expenditure Details: Real GDP Growth

The bar chart illustrates Ontario’s quarterly per cent real GDP growth from the first quarter of 2016 to the third quarter of 2020. Ontario has experienced real GDP growth over the entire period up until the first quarter of 2020 when real growth decreased by 1.8% followed by a steeper 12.2% decline in the second quarter. Real GDP rebounded by 9.4% in the third quarter of 2020.

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Expenditure Details: Real GDP Change by Expenditure Component

The horizontal bar chart depicts the per cent change in Ontario’s real GDP and its components for the third quarter of 2020. Real GDP increased by 9.4% in the quarter, with increases in household consumption (+13.6%), business investment (+22.5%), government (+3.6%), exports (+20.2%) and imports (+25.5%).

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Expenditure Details: Real Export and Import Growth

The bar chart shows the quarterly per cent change in real exports and imports from the first quarter of 2016 to the third quarter of 2020. Exports increased by 20.2% in the third quarter of 2020, following a  19.3% decline in the second quarter, while imports rose 25.5% in the third quarter of 2020, after declining 21.8% in the second quarter.

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Income Details: Nominal GDP Growth

The bar chart illustrates Ontario’s quarterly per cent nominal GDP growth from the first quarter of 2016 to the third quarter of 2020. Ontario has experienced nominal GDP growth over the entire period, except for the fourth quarter of 2018, when growth was flat and in the first two quarters of 2020. Nominal GDP declined a record 13.0% in the second quarter of 2020, following a decrease of 2.2% in the first quarter of 2020. This was followed by a record 11.8% rebound in the third quarter of 2020.

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Income Details: Nominal GDP Change by Income Component

The horizontal bar chart depicts the per cent change in nominal GDP and its components for the third quarter of 2020. Nominal GDP advanced 11.8% in the third quarter, with large gains in net operating surplus (+21.3%), compensation of employees (+8.3%) and net mixed income (+5.3%) in the third quarter of 2020.

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Income Details: Compensation of Employees Growth

The bar chart shows Ontario’s quarterly growth of employee compensation in per cent from the first quarter of 2016 to the third quarter of 2020. Compensation of employees has risen in every quarter over the period, except for the first quarter of 2016 when it declined by 0.7% and for the first and second quarters of 2020. Compensation of employees decreased by 8.5% in the second quarter of 2020, after declining 1.3% in the first quarter of 2020. This was followed by a 8.3% rebound in the third quarter of 2020.

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Price Details: Economy-Wide Price Growth

The bar chart illustrates Ontario’s quarterly growth of economy-wide prices in per cent from the first quarter of 2016 to the third quarter of 2020. Economy-wide prices increased by 2.2% in the third quarter of 2020, after decreasing in both the second (−0.9%) and third (−0.4%) quarters of 2020. Prior to 2020, the strongest increase over the period was in the second quarter of 2019, at 1.0%. A declines of 0.2% was recorded in the third quarter of 2017.

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Price Details: Price Change by Expenditure Component

The horizontal bar chart shows the per cent change in prices by expenditure component for the third quarter of 2020. Prices increased for household consumption (+1.0%), business investment (+3.8%) and exports (+1.9%). Prices were lower for the government sector (−0.2%) and for imports (−0.1%) in the third quarter.

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Price Details: Export and Import Price Growth

The bar chart illustrates Ontario’s quarterly growth of export and import prices in per cent from the first quarter of 2016 to the third quarter of 2020. Both export prices (−2.4%) and import prices (−1.9%) declined sharply in the second quarter of 2020. Export prices rebounded by 1.9% in the third quarter while import prices declined by 0.1% in the quarter. Since 2016, the largest gain in export prices occurred in the second quarter of 2018 when they rose 2.2%. The largest gain in import prices since 2016, occurred in the second quarter of 2018 when they rose 2.4%. The largest fall in import (−3.2%) and export (−3.1%) prices was in the third quarter of 2017.

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Industry Details: Real GDP Growth by Industry

The bar chart depicts Ontario’s quarterly growth of real GDP by industry in per cent from the first quarter of 2016 to the third quarter of 2020. Ontario real GDP increased by 9.7% in the third quarter of 2020, following a 12.0% decrease in the second quarter. Real GDP by industry has grown over the entire period, except the second (−0.4%) and fourth (−0.2%) quarter of 2016 and the first two quarters of 2020. The strongest gain was recorded in the the third quarter of 2020 (+9.7%).

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Industry Details: Real GDP Change by Industry

The horizontal bar chart illustrates the per cent change in real GDP by industry for the third quarter of 2020. The output of all industries increased 9.7% in the quarter. Output increased in goods-producing industries (+15.6%), with industry changes as follows: manufacturing (+23.9%); construction (+10.9%); utilities (+1.6%); and primary industries (+1.3%). Output in the service industries increased 8.3%, including industry changes as follows: retail trade (+20.4%); wholesale trade (+17.3%); other services (+13.0%); professional and administrative services (+7.0%); health, education and public administration (+6.7%); real estate, rental and leasing (+4.8%); and finance and insurance (+2.6%).

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Industry Details: Real GDP Change by Manufacturing Industry

The horizontal bar chart shows the per cent change in real GDP by the manufacturing industry for the third quarter of 2020. In total, output by manufacturing industries increased 23.9% in the quarter. The change in output of each manufacturing industry is as follows: transportation equipment (+98.9%); plastic and rubber (+37.5%);  textile, clothing and leather (+32.9%); other manufacturing (+26.9%); machinery (+16.8%); wood and furniture (+16.6%); primary and fabricated metal (+14.1%); electrical and electronic (+12.6%); paper and printing (+8.8%); food, beverage and tobacco (+7.5%); and chemical and petroleum (+6.6%).

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Juristictional Comparisons: Canadian Real GDP Growth

The bar chart illustrates Canada’s quarterly per cent real GDP growth from the first quarter of 2016 to the third quarter of 2020. Canada has experienced real GDP growth over the entire period up until the first quarter of 2020 when real growth decreased by 2.1% followed by a steeper 11.5% decline in the second quarter. Real GDP rebounded by 8.9% in the third quarter of 2020.

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Jurisdictional Comparisons: Quebec Real GDP Growth

The bar chart illustrates Quebec’s quarterly per cent real GDP growth from the first quarter of 2016 to the third quarter of 2020. Quebec has experienced real GDP growth over the entire period, with the exception of the first and second quarters of 2020. Quebec real GDP declined 11.9% in the second quarter of 2020, following a decrease of 2.7% in the first quarter. Real GDP rebounded by 12.6% in the third quarter of 2020.

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Jurisdictional Comparisons: U.S. Real GDP Growth

The bar chart illustrates the U.S.’s quarterly per cent real GDP growth from the first quarter of 2016 to the third quarter of 2020. The U.S.has experienced real GDP growth over the entire period up until the first quarter of 2020 when real growth decreased by 1.3%.  Real GDP rebounded by 7.5% in the third quarter of 2020 following a 9.0% decline in the second quarter.

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Global Economic Developments: Real GDP Growth

This bar chart shows quarterly percentage changes in real GDP for the U.S., the euro area, Germany, the United Kingdom, Japan and China for the second and third quarters of 2020. U.S. real GDP increased 7.5% in the third quarter following a 9.0% decline in the second quarter. Euro area real GDP increased 12.5% in the third quarter following a 11.7% decline in the second quarter. Germany’s real GDP increased 8.5% in the third quarter following a 9.8% decline in the second quarter. Real GDP in the United Kingdom grew 16.0% in the third quarter following a 18.8% decline in the second quarter. Japan’s real GDP increased 5.3% in the third quarter and declined 8.3% in the second quarter. China’s real GDP advanced 2.7% in the third quarter and 11.7% in the second quarter.

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Global Economic Developments: Real GDP Levels

This line chart shows indexed real GDP levels (2019Q4 = 100) for China, Japan, the U.S., the euro area and the United Kingdom. China is the only economy in the chart that surpassed its 2019Q4 real GDP level in 2020Q3 (3.2% higher). Compared to 2019Q4, real GDP in 2020Q3 is 3.4% lower for the U.S., 4.4% lower for Euro area, 4.0% lower for Germany, 9.7% lower for the United Kingdom, and 3.9% lower for Japan.

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Global Economic Developments: U.S. Labour Market

This chart shows the U.S. unemployment rate in per cent from January 2016 to November 2020. The unemployment rate gradually lowered from 4.9% in January 2016 to 3.5% in February 2020. It then rose to 14.7% in April before easing down to 6.9% in October and 6.7% in November.

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Global Economic Developments: Oil Prices and the Canadian Dollar

The line chart shows the daily oil price ($US per barrel) and Canadian dollar exchange rate (cents U.S.) between January 2016 and December 2020. Starting in 2016, the Canadian dollar rose, peaking at about 82 cents in September 2017 before trending down to about 75 cents in February 2020. In March the Canadian dollar declined to around 70 cents U.S. before recovering to around 78 cents U.S. in mid-December. WTI oil prices rose steadily between 2016 and 2018, rising from below $30 to $77 US per barrel in June 2018. Prices declined to around $45 US per barrel at the end of 2018. Prices trended up slightly in 2019 to about $60 US per barrel in December before declining aggressively and briefly reached a negative of $37 U.S. per barrel in April 2020. The oil price has since gained to around $46 U.S. per barrel in early December.

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Global Economic Developments: Stock Market Indices

The line chart shows the daily value of the S&P 500, Nikkei, S&P TSX and Euro Stoxx 50 stock indexes from January 2016 to December 2020. All are indexed to January 4, 2016 equaling 100. All indices trended upwards in 2019 and early 2020, peaking in late February 2020, before declining sharply and reaching a trough in March. All indices have recovered strongly with S&P 500 and Nikkei both rising above its March peak.

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Global Economic Developments: Government of Canada 10-Year Bond Rates

This line chart shows rates for Government of Canada 10-year bonds from January 2016 to mid-December 2020. The rate rose relatively steadily from about 1.3% at the beginning of 2016 to 2.6% in October 2018 and declined to a low of 0.4% in August 2020. The rate gradually increased to around 0.7% in mid-December.

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Employment: Ontario’s Labour Force

The chart indicates that as of November, Ontario has added 905,200 net new jobs since June and that the unemployment rate was 9.1% in November 2020.

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Employment: Employment Change Since June

The bar chart illustrates the breakdown in the change in employment measured in thousands of jobs since June 2020. As of November 2020, total employment has risen by 905,200 net new jobs. Changes were as follows: private sector, a gain of 783,400 jobs; public sector, a gain of 115,500 jobs; self-employed, a gain of 6,300 jobs; full-time, a gain of 590,200 jobs; part-time, a gain of 314,900 jobs; goods, a gain of 219,000 jobs; and services, a gain of 686,200 jobs.

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Employment: Ontario’s Employment and Unemployment Rate

The chart shows Ontario’s monthly employment level as a shaded area and unemployment rate as a line from January 2018 to November 2020. The unemployment rate trended down from 5.9% in early 2019 to 5.5% in February 2020 and had increased to 13.6% in May 2020 and has since trended down to 9.1% in November 2020. Employment has increased steadily over the period from about 7.2 million in January 2018 to about 7.6 million in February 2020 and had declined to 6.4 million in May 2020. In November 2020, employment increased to 7.3 million.

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Consumer and Business Activity: Retail Sales

The line chart shows Ontario’s retail sales in billions of dollars from January 2016 to October 2020. Ontario’s retail sales have trended upwards from $16.5 billion in January 2016 to $19.8 billion in February 2020. There was a sharp decline to $12.5 billion in April 2020. This was followed by a sharp rebound with sales increasing to $20.0 billion in October.

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Consumer and Business Activity: Wholesale Trade

The line chart shows Ontario’s wholesale trade in billions of dollars from January 2016 to October 2020. Ontario’s wholesale trade has trended upwards from $29.1 billion in January 2016 to $34.0 billion in February 2020. There was a sharp decline to $23.0 billion in April 2020. This was followed by a sharp rebound with wholesale trade increasing to $34.7 billion in October.

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Consumer and Business Activity: Manufacturing Sales

The line chart shows Ontario’s manufacturing sales in billions of dollars from January 2016 to October 2020. Ontario’s manufacturing sales have fluctuated over the period, largely remaining between $24 billion and $27 billion. Beginning in in early 2020, manufacturing sales took a sharp decline declining to $14.0 billion in April. This was followed by a sharp rebound with manufacturing sales increasing to $25.5 billion in October.

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Housing: Home Resales

The combination line and bar chart shows Ontario’s home resales in both thousands of units (right axis) and per cent change (left axis) from November 2019 to November 2020. Home resales were fairly stable in the final two months of 2019 averaging around 18,000 units per month. After edging down to the 17,700 range in January, Ontario home resales increased by 19.1% in February to 21,050 units, before declining sharply in March (−20.5%) and April (−59.7%), with home resales declining to just 6,700 units in April. Beginning in May, home resales began to rebound stongly over the next four months, reaching a record high of 23,521 units in August. This was followed by a period of easing as home sales declined in September (−0.2%), October (−2.6%) and November (−4.1%) with home resales declining to just under 22,000 units in November.

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Housing: Home Resale Prices

The combination line and bar chart shows the average resale price on an Ontario home in thousands of dollars (right axis) and per cent change (left axis) from November 2019 to November 2020.  

The chart shows resale prices growing in the final two months of 2019 with the average resale price of an Ontario home hitting a high of close to $643,000 in December. Resales prices continued to rise in the first two months of 2020 reaching a new high of almost $680,000 in February. The average home resale price declined in March and April, before rebounding over the next four months, advancing from $606,000 in May 2020 to an all-time high of around $753,000 in August. This was followed by a period of easing as home resale prices declined in September (−2.0%) and October (−0.8%) with the average home resale price declining to just under $732,000 in October. A small 1.9% uptick occurred in November as the average home resale price rose to $746,000 in the month.

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Housing: Housing Starts

The line shows Ontario’s housing starts in units (seasonally adjusted at annual rates) from January 2016 to November 2020. Ontario’s housing starts were volatile over the period, with highs of 104,000 units in February 2018 and June 2018 and a trough of 49,000 units in May 2019. Since then, housing starts increased to 94,500 units in April 2020. They dropped sharply in May to about 58,000 units but rebouned strongly over the June to August period, hitting a high of almost 117,500 units in August. This was followed by a period of easing as housing starts declined by 31.4% in September and grew only modestly in October (+2.8%) and November (+0.5%) with starts reaching a level of just over 83,200 units in the month.

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In Focus: Real Residential Investment

The bar chart shows the quarter over quarter per cent change in real residential investment from the first quarter of 2016 to the third quarter of 2020. Residential investment grew solidly from the first quarter of 2016 up to the first quarter of 2017 when it peaked at 6.1% growth. Investmend dropped sharply in both the second (−7.5%) and third (−3.6%) quarters of 2017. This was followed by modest growth up to the third quarter of 2018. Investment then dropped in the fourth quarter of 2018 (−3.2%) and the first quarter of 2019 (−2.1%). Residential investment picked up over the remainder of 2019 with peak growth of 7.2% posted in the third of 2019. Investment dropped by a sharp 16.4% in the second quarter of 2020 but rebounded at a record 37.2% pace in the third quarter of 2020.

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In Focus: Residential Investment by Component

The line chart shows real investment in new home construction, renovations and ownership transfer costs in billions of dollars from the first quarter of 2000 to the third quarter of 2018. The chart shows new housing growing from $23.6 billion in the first quarter of 2016 to a peak of $25.9 billion in first quarter of 2017. Over the next two years new housing trended lower, falling to a low of $22.0 billion in the second quarter of 2019. This was followed by a period of stronger growth which peaked in the third quarter of 2020 when investment hit a high of $28.1 billion. The chart also shows renovations growing at more steady pace over the 2016 to 2019 period from $19.8 billion in the first quarter of 2016, hitting a peak of $21.5 billion in the third quarter of 2019. Renovation investment fell sharply in the second quarter of 2020  to a low of $17.1 billion but recovered in the third quarter of 2020 to reach a level of $21.4 billion. The chart also shows ownership transfer costs rising strongly from a level of $12.9 billion in the first quarter of 2016 to a peak of $15.1 billion in the first quarter of 2017. From this high point, ownership transfer costs fell sharply in the second and third quarters of 2017 and trended downwards over the next two years reaching a low of $10.6 billion in the first quarter of 2019. This was followed by a period of growth which saw investment rise to $12.8 billion by the first quarter of 2020. Ownership transfer costs fell sharply in the second quarter of 2020 to a low of $8.3 billion but recovered to a high of $16.9 billion in the third quarter of 2020.

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In Focus: Residential Investment Growth Since 2019Q4

The bar chart shows the growth in total residential investment, new home construction, renovations and ownership transfer costs from the fourth quarter of 2019 to the third quarter of 2020. Total residential investment grew by 14.8%, new home construction grew by 9.8%, renovations grew by 2.1% and ownership transfer costs grew by 35.5% since 2019Q4.

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Appendix: Per Cent Share of Nominal GDP, 2019

This pie chart shows the percent share of nominal GDP by industry for 2019. Goods-producing industries accounted for 22.3% of Ontario’s nominal GDP with industry shares as follows: manufacturing (11.7%), construction (6.8%), utilities (1.9%) and primary industries (2.0%). Services-producing industries accounted for 77.7% of Ontario’s nominal GDP with industry shares as follows: health and education (12.8%), real estate, rental and leasing (13.2%), wholesale and retail trade (10.9%), finance and insurance (9.5%), public administration (7.4%) transportation and warehousing (4.2%), information and culture (3.7%) and other services (16.0%).

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Appendix: GDP measurement methodss

  • Expenditure Approach
    • Sum of expenditures of all sectors of the economy
    • Consumer Spending + Investment + Government Spending + Exports – Imports
  • Income Approach
    • Sum of all incomes
    • Wage and Salaries + Profits + Mixed Incomes + Indirect taxes – Subsidies
  • Production Approach (GDP by Industry)
    • Sum of value added in all industry sectors
    • Output of Goods Producing Industries + Output of Services Producing Industries – Intermediate Inputs

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