Ontario Labour Market Update

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Ontario Labour Market Update October 2009
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Fundamental Economic Drivers

• U.S. Outlook
• Energy/Commodity Prices
• Monetary Policy and the Canada/US Exchange Rate
• Exports
• Fiscal Policy

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Projection Summary for the US
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Energy/Commodity Prices
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Exchange Rate US/Canada
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Fiscal Policy- Economic Action Plan

• Economic Action Plan in the January 2009 federal
  budget included major infrastructure spending
  over the next twenty-four months.
• EI is acting as an automatic stabilizer to the
  economy by providing income support to laid off
  workers. Additional funding for EI supports this
  stabilizing function.

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Demographics are important
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The current situation

• Demographics and population aging are slowing
  labour force growth and the participation rate is
  also weakening as a result of the downturn. This
  has moderated the upward pressure on the
  unemployment rate.
• The province's unemployment rate fell to 9.2 in
  September a decline of 0.2 percentage points from
  August.
• The good news is that employment in Ontario
  increased slightly for a third consecutive month
  in September, and has risen by 39,000 since June.
  
• The bad news is that compared to last September,
  just before the start of the labour market
  downturn, Ontario employment has fallen by
  205,000 (-3.0).
• September employment gains were in retail and
  wholesale trade, construction and in
  manufacturing.
• Infrastructure spending and the Economic Action
  Plan starting to impact the economy

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By Region and Major Municipality

• Southwestern and Northern Ontario remain the
  areas most affected although the Toronto
  situation has also deteriorated.
• Windsor Economic Region Unadjusted Unemployment
  Rate for September 2009 was 12.3.
• London and Toronto Regions at 10.9 and 10.4
  respectively.
• Northeastern Ontario Region Unadjusted
  Unemployment rate was 9.9.

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Autos have been key and forestry remains
problematic

• Auto industry restructuring has been ongoing.
  Return to work for Chrysler and emergence of GM
  from bankruptcy have lessened the uncertainty
  although the sector, particularly parts, will
  continue to evolve.
• Continuing uncertainty around forestry
  bankruptcies.
• Forest products have been Ontarios second
  biggest net export, over 9 billion (newsprint,
  market pulp, lumber and composite panels).
  Vertically integrated industry.
• Lack of capital investment over last 20 years in
  research and development, new technologies, mills
  and equipment
• Collapse of US housing boom resulting in lower
  prices for lumber and most other building
  materials
• Northwest Ontario most dependent and affected
• Pulp and papers perfect storm- rapid rise in
  Canadian dollar- rise in energy costs and
  transportation costs- low cost foreign
  competitors- decline in demand for newsprint

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But some sectors employment is up over the past
year

• Finance Insurance and Real Estate
• Professional Scientific and Technical Services
• Information Culture and Recreation
• Other Services including Repair and Maintenance,
  Personal Services, Civic Organizations and
  Private Households

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And commodities are coming back

• The price of gold is at a record high
• The Bending Lake Iron Group is developing plans
  for an open pit iron mine south of Ignace in
  Northwest Ontario. The main industrial site for
  the mine will be located in Atikokan. Once the
  mine is operational they expect to employ 300
  full time workers.
• Higher oil prices are good for Alberta but not so
  good for Ontario
• However high energy prices can also be a catalyst
  for development.

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Green Shootsthe impact of Green Energy
Investments

• New investments imply new labour market
  opportunities
• Energy Conservation and Demand Response
• Green Energy Act September 24 2009
• Feed-in-tariffs- wind and solar farm
  construction
• Increasing domestic content requirements
• Power transmission investment in 2.3 billion in
  projects designed to increase reliability of
  power transmission in the province.
• Half of the projects will be located in Northern
  Ontario. These projects are expected to create
  6,000 jobs and thousands of megawatts of energy

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Green Energy impacts

• New opportunities in a wide range of
  manufacturing and green energy services
• Wind turbine manufacturing jobs in welding,
  machining and fabrication
• Financial analyst-budgeting, cost of sales and
  ERP analysis for growing solar technology
  supplier
• Financing specialist start-ups and real estate
  acquisition for new energy developments
• Key accounts representative with engineering
  technician background for industrial markets and
  distribution generation
• Electrical transmission line construction
• New skills in existing professions
• LEED commercial office construction planning and
  management
• Instrumentation and Controls Engineer- Energy
  conservation
• Supervisor, Meter Communications Technology
• New emerging fields and professions
• Electrical Grid Load management and Demand
  Response consulting
• Residential and industrial energy auditors
• Engineering technician and installer-HVAC systems
  and solar energy
• Municipal Energy Conservation Coordinator
• In-water windfarm maintenance
• Superintendent for photovoltaic construction site

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