Economic and Investment Update – January 2023
- The Consumer Price Index (CPI) dropped to 6.8 per cent in November
- The national unemployment rate dropped slightly to 5.1 per cent in November
- Real Gross Domestic Product (GDP) increased slightly in October despite a decline in goods-producing industries
- Small Business and Entrepreneurship demand for consultations driven by Professional, Scientific & Technical Services, Retail Trade, and Other Services (except Public Administration) industries in December
- avid hotel opened its first Canadian hotel property in Vaughan in December
- Vaughan headquartered Dishon Limited is recipient of federal funding with the Aerospace Regional and Recovery Initiative to further economic growth and job creation
- Vaughan-based Litens Automotive entered a partnership with University of Toronto’s Faculty of Applied Science to collaborate on next-generation electric vehicle parts
SELECT Economic Indicators
The Consumer Price Index (CPI) increased 6.8 per cent year-over-year in November
The Consumer Price Index (CPI) increased by 6.8 per cent in November, marking a third consecutive month below seven per cent. Ontario’s CPI decreased, to 6.4 per cent over the same period.
Prices for groceries continue to be a main driver of inflation. Food purchased from stores rose 11.4 per cent year-over-year in November, on the heels of a 11 per cent gain in October. Causes of these increases include higher costs of production inputs like energy and fertilizer, unpredictable weather events which are linked to climate change affecting growing conditions, and continued geopolitical instability in Ukraine and Russia.
The national unemployment rate dropped slightly to 5.1 per cent in November
National unemployment saw a slight reduction to 5.1 per cent in November, while in Ontario, unemployment contracted to 5.5 per cent. In the Toronto Census Metropolitan Area (CMA) – which includes Vaughan – also saw a slight decrease to 6.2 per cent in November. The participate rate of core-aged women reached a new record high in November, hitting 85.1 per cent, while labour force participation of youth (aged 15 to 24) fell to 63.6 per cent in the same period. Labour force participation rates of core-aged men saw little change at 91.7 per cent participation in November.
Youth unemployment in Ontario (aged 15 to 24) decreased to 12.2 per cent, while unemployment for adult men (25 years and adult women (25 years and over) in Ontario continued to decreased slightly, to 4.2 and 4.8 per cent respectively.
This release of the Labour Force Survey highlighted the influential impact on local labour market conditions of the information and communications technology (ICT) sector. In the Toronto CMA, ICT employment accounts for 6.8 per cent of all employment. This grouping of industries are central to the growth of the digital economy, including computer systems design and related services, software publishers, and semiconductor and other electronic component manufacturing – including required technologies for next-generation auto and auto-parts manufacturing. The survey noted the decline in employment growth in ICT from November 2021 to November 2022, with employment falling by 3.8 per cent.
Vaughan is at the heart of the York Region tech eco-system and Canada’s second largest tech hub, which is home to more than 4,600 ICT companies and 60,000 jobs across the Region.
Real Gross Domestic Product (GDP) increased slightly in October despite a decline in goods-producing industries
Real Gross Domestic Product (GDP), which measures the inflation-adjusted value of goods and services produced in the economy, increased by 0.1 per cent in October.
Manufacturing had its sixth contraction in seven months, declining by 0.7 per cent compared with 0.1 per cent in September. Durable food manufacturing contracted by 1.1 per cent, while non-durable goods fell 0.1 per cent. Manufacturing accounted for $4.69 billion of economic output and employed nearly 42,000 workers in Vaughan in 2021.
Services-producing industries expanded in October, led by client-facing industries such as arts and entertainment (up 2.2 per cent) and the accommodation, food services and drinking places sector (up one per cent).
LOCAL TRENDS, INVESTMENTS, AND SUCCESS STORIES
Small Business and Entrepreneurship sees demand for consultations driven by Professional, Scientific & Technical Services, Retail Trade, and Other Services (except Public Administration) industries in December
ED’s Small Business and Entrepreneurship top five industries seeking consultations in December were:
- Professional, Scientific & Technical Services (36%)
- Retail Trade (14%)
- Other Services (Except Public Administration) (14%)
- Other (12%)
- Accommodation & Food Services (8%)
avid hotel opened its first Canadian hotel property in Vaughan in December
IHG Hotels and Resorts (IHG) opened its first Canadian avid hotel property in Vaughan in December, operating as avid hotel Toronto – Vaughan Southwest. This is the first of four planned properties across Canada to open and features 119 rooms
This hotel is one of 16 in the City. Despite a slow first quarter, Vaughan accommodations had a strong finish to 2022, representing $85 million in revenue (an increase of $10 million more than 2019, and $41 million more than 2021). Occupancy rates in 2022 averaged to 73.8 per cent, which was a 0.6 increase from 2019, and a 17.4 per cent increase from 2021.
Vaughan headquartered Dishon Limited is recipient of federal funding with the Aerospace Regional and Recovery Initiative to further economic growth and job creation
Announced in December, Vaughan-headquartered Dishon Limited is the recipient of more than $4.2 million through the Aerospace Regional and Recovery Initiative (ARRI). Operating out of two facilities in Vaughan, Ontario, Dishon Limited produces components for parts used in the aerospace sector, such as landing gear, engines and fluid systems. Through this investment, the company will employ new manufacturing equipment, allowing for the commercialization of up to 200 new parts. This will help them expand into new markets like space and electrical aviation. The project is expected to increase revenue by up to $18 million and create 50 new jobs in Vaughan.
There are approximately 8 companies employing over 600 people located in Woodbridge and Concord that contribute to Vaughan’s aerospace and aviation cluster. Other companies include Merco Industries Ltd., Norcanco Inc., and Discovery Precision Machining Inc..
Vaughan-based Litens Automotive enters partnership with University of Toronto’s Faculty of Applied Science to collaborate on next-generation electric vehicle parts
Litens Autmotive, a global leader specializing in powertrain system engineering and component supply that has strong production supply relationships with major OEMs, announced the acquisition of controlling interest in Spain-based Industrias Dolz SA. Litens has three locations in Vaughan, including its Canadian headquarters and head office.
Within York Region, more than 250 automotive-related companies support 15,000 direct jobs and 34,000 sector-relevant jobs. The Region is home to Canada’s largest independent automotive parts and electronics manufacturing cluster, most of which are located in Vaughan. Vaughan has more than 50 automotive parts manufacturing businesses employ over 6,800 people, and more than 190 motor vehicle and parts dealers employ more than 3,700 people according to the latest York Region Employment Survey. The manufacturing industry which automotive is a huge part of contributes $4.6 billion or 19% to Vaughan’s total GDP.
Vaughan’s automotive sector includes many globally recognized tier 1 suppliers, such as Magna International, Martinrea, Multimatic, Hanon Systems, Litens Automotive, IAC, and Woodbridge Foam Corporation as well as numerous tier 2 and tier 3 suppliers. A wide range of automotive products is made in Vaughan including driveline systems, fluid pressure and controls, hinges, brakes, seats, transmissions and many more.