Ottawa, ON — After a difficult 2003, Toronto is on track to be the fastest-growing metropolitan economy in Canada for 2004 and over the medium term, according to the Autumn 2004 edition of the Conference Board’s Metropolitan Outlook.
"Toronto’s economy is back with a vengeance in 2004, with growth expected to reach 5.3%. Robust manufacturing activity, a strengthening service sector and another banner year in the construction industry are all contributing to Toronto’s turnaround from the difficulties it experienced in 2003," said Mario Lefebvre, director, Metropolitan Outlook Service.
The manufacturing sector in Toronto had an outstanding first half in 2004, benefiting from rising U.S. demand. Toronto’s tourism sector is finally recovering, albeit slowly, following a couple of difficult years. From 2005 to 2008, Toronto’s real gross domestic product (GDP) is expected to increase by an annual average of 3.6%, leading all 18 Census Metropolitan Areas (CMAs) covered in the Autumn edition of the Metropolitan Outlook.
In Ottawa-Gatineau, federal government employment is set to increase for the sixth consecutive year, boosting overall GDP growth to 3.1% in 2004. Economic growth will be even faster next year, coming in at 3.5%. This will come about due to stronger activity in manufacturing, specifically the telecom sector, and a rebound in non-residential construction activity.
After several years of strong expansion, Oshawa’s economy will grow by just 0.4% in 2004, as some services-related industries take a breather. This will be a one-year slowdown, however, as real GDP growth is forecast to reach 3.8% next year. The CMA continues to enjoy strong population growth, which provides support to both the services and housing sectors.
Hamilton’s manufacturing industry, which posted a large output gain in 2003, continues to perform well. This is providing an offset to a struggling services sector and a cooling non-residential construction industry. All in all, real GDP growth is forecast to come in at 2.9% this year and at 3.5% in 2005, as the services sector recovers.
Windsor’s fortunes rise and fall with the manufacturing industry. Given that this sector is expected to post a decline of 4.3% in 2004its second consecutive year of decreasing outputit comes as no surprise that overall GDP growth in the CMA will be limited to 0.4%. Manufacturing activity is forecast to strengthen in 2005, boosting overall GDP growth to 4.3%.
Kitchener’s economy will eke out a gain of 0.1% this year, even though its manufacturing sector is strengthening following three lean years. This will be almost entirely offset by declines in the construction and services sectors. But 2005 looks brighter, as the economy is expected to increase by 4.3%. Accelerating employment and personal income growth bodes well for consumer spending.
The Metropolitan Outlook is produced three times a year and provides economic insights into 25 Census Metropolitan Areas, their related province, and Canada.