The province’s key industries range from mining, agriculture, and manufacturing to “new economy” industries including automotive and other advanced manufacturing sectors, aerospace, clean technology, software, IT, cyber security, medical devices, and pharma.
A vital part of Ontario’s economic success is its workforce. With a diverse population of more than 14 million people, the province is home to 40 percent of Canada’s population. Nearly three-quarters of Ontario adults have post-secondary education — higher than in any Organization for Economic Cooperation and Development (OECD) country. Its universities and colleges provide a stream of new, high-quality talent every year, including 63,500 STEM (science, technology, engineering, and math) graduates. In fact, Toronto has one of the fastest-growing tech workforces in North America.
A vital part of Ontario’s economic success is its workforce. Ontario provides a stable and competitive business environment for both domestic and international companies. Located in the center of North America, Ontario is only a one-day drive from nearly 200 million consumers. Its modern transportation infrastructure is one of the best in North America for warehousing and distribution operations. Business costs in Ontario are highly competitive with other countries, especially for clean and affordable energy — Ontario has one of the world’s cleanest electricity grids, with more than 90 percent of the province’s electricity generation producing zero emissions.
Top growth industries in Ontario include:
- Aerospace: Over 200 Ontario companies contribute to every part of the global aerospace supply chain, generating more than $6 billion in combined annual revenue and investing over $500 million in R&D every year. Educational institutions provide more than 40 post-secondary programs in applied aerospace and aviation disciplines.
- Automotive: Ontario is the second-largest largest vehicle manufacturer in North America. LG Energy Solution and Stellantis recently announced a partnership to build a $5 billion electric vehicle (EV) battery plant, the largest automotive manufacturing investment in the history of the province.
Business costs in Ontario are highly competitive with other countries, especially for clean and affordable energy. Construction of the plant on 350 acres in Lennox & Addington County, Ontario, will begin next year and is slated for completion in 2025. Umicore decided to build in Ontario in part because the province’s grid — largely fueled by hydroelectric and nuclear power — supports a factory that can produce battery components with net-zero carbon emissions, according to the company’s chief executive Mathias Miedreich, who added that Umicore also opted for an Ontario plant to shorten its supply chain with North American automakers.
“The Umicore announcement in Lennox & Addington reinforces our core message that Ontario East is, and will be, a key player in Ontario's EV automotive supply chain. Our regional approach to investment attraction combined with cost advantages, workforce talent, institutional expertise, and quality of life opportunities will continue to position the region for job growth in this priority sector for Ontario and Canada,” says Jay Amer, executive director of Ontario East Economic Development.
- Technology: Ontario companies are designing next-generation systems and products for computers, telecommunications, robotics, artificial intelligence, and financial technology. Ontario also plays a leading role in cybersecurity, which includes the University of Waterloo’s Institute for Quantum Computing and the Cybersecurity and Privacy Institute.
- Medical Technology: More than 1,300 Ontario medical technology companies generate about $14 billion in annual revenues. They manufacture a wide range of equipment and devices for the diagnosis, treatment, and prevention of disease. Global companies such as GE Healthcare and Stryker locate here to collaborate with Ontario’s network of academic and research institutes and industry incubators.
- Pharma: Ontario has long been a leader in pharmaceutical development and manufacturing. About 2,000 life sciences firms employ about 60,000 people and generate over $38 billion in revenues annually. Many of the world’s top pharma companies — including Pfizer, Sanofi, GlaxoSmithKline, and Merck — conduct clinical trials in Ontario. In particular, McMaster University’s Population Health Research Institute (PHRI) is well known for its global clinical trials and studies.
With the support of the Ontario government, smaller regions and communities across the province are also experiencing investment support and economic growth. According to Ontario East’s Jay Amer, “Challenges include putting into action lessons learned from the pandemic, supporting local industries, and expanding workforce development programs.”
Proactive government programs that have assisted the resurgence of regional economies that were hit hard by the COVID-19 pandemic include:
- Ontario Action Plan: To date, investments total $16.3 billion to protect people’s health and $23.3 billion for economic business support.
- SupportOntarioMade.ca: This program encourages manufacturers and producers to register and promote their products on the Canadian Manufacturers & Exporters (CME) platform; Ontario plans to contribute an additional $1 million in 2021–22 to support the program.
- Ontario Together Fund: Small businesses are supported through relief grants, business costs rebate plans, skills training, financial support, and other small business recovery resources. As of February 2022, Ontario has committed more than $55 million to the fund.
With the support of the Ontario government, smaller regions and communities across the province are also experiencing investment support and economic growth. Smaller projects include the Federal Economic Development Agency for Southern Ontario’s investment of up to $2.5 million to support Martello Technologies Corporation’s expansion plans. Headquartered in Ottawa, the company is a global leader in electronic data gathering and analytics. In another recent announcement, the Ontario government will invest $1.5 million to help scale up the manufacturing and distribution of Flosonics Medical’s medical devices. Located in Sudbury, a northern community with a long mining history, Flosonics Medical manufactures the FloPatch, the world’s first wearable wireless Doppler ultrasound device for assessing blood flow noninvasively.
Recovery in Progress
According to the Ontario Chamber of Commerce’s 2022 Ontario Economic Report, real GDP in Ontario rebounded by 4.2 percent in 2021 and is expected to grow another 4.1 percent in 2022. Accordingly, employment grew 4.9 percent in 2021 and is expected to grow 4.2 percent in 2022.
These encouraging economic trends, however, could be threatened in 2022 by labor shortages, global supply chain disruptions, and inflation.
“Ontario needs a pro-growth strategy for economic recovery,” stated the report. “Many businesses are preoccupied with navigating day-to-day cost pressures, and they need immediate government support. However, government also needs to balance those short-term needs with the equally important long-term investments in economic growth. This includes both investing in the key drivers of business competitiveness — such as workforce development, immigration, technology, infrastructure, and clean energy — as well as removing unnecessary barriers to growth, including outdated regulations, an inefficient tax system, and obstacles to interprovincial trade and labor mobility.”