“One of the more turbulent economic periods in Canadian history” is about to end, according to one of the foremost authorities on the nation’s economic performance.
The good news is that while the recession, “which is particularly nasty in Ontario, is about to end,” said Don Drummond, senior vice-president and chief economist of TD Bank Financial Group, “the bad news is that it’s still going on elsewhere.”
With an economy more similar to the U.S. than the rest of Canada, Ontario was hit hard during the recession, said Drummond, who was a keynote speaker at the Association of Municipalities of Ontario conference here yesterday.
So far, there have been 414,000 job losses in Canada during this recession, “a disproportionate number of which are in Ontario,” Drummond said. One of the reasons for this is the Ontario’s automobile industry — 90 per cent of the vehicles manufactured here are destined for the U.S. market, he said.
The recession has hit manufacturing the hardest out of all the sectors, and most manufacturing jobs in Canada are in Ontario, he said. He said he expects the number of job losses to rise to 507,000 before the recession is over, and for the unemployment rate to hit 10 per cent by the end of this year.
But while Ontario workers may see a boom in the welfare caseload, Drummond said home prices are surprisingly resilient. The demand for homes is strong, which proves it works to keep interest rates low, he said.