Economic and Investment Update – December 2022
- The Consumer Price Index (CPI) maintained at 6.9 per cent in October for the second consecutive month
- The national unemployment rate remained at 5.2 per cent while labour force participation increased
- Real Gross Domestic Product (GDP) edged up another 0.1 per cent in September, led by increases in the goods-producing industries
- Small Business and Entrepreneurship saw demand for consultations driven by Retail Trade, Accommodation & Food Services, and Other industries in October
- Vaughan-headquartered Summer Fresh received federal investment through the Jobs and Growth fund
- Vaughan-based Litens Automotive expanded its aftermarket activities with the acquisition of a controlling interest in a Spanish water pump manufacturer
SELECT Economic Indicators
The Consumer Price Index (CPI) maintained at 6.9 per cent year-over-year in October for second consecutive month
The Consumer Price Index (CPI) remained at 6.9 per cent in October marking a second consecutive month below seven per cent. Ontario’s CPI decreased, to 6.5 per cent in October.
The increase in gasoline prices seen in October put upward pressure across all items included in CPI. On a year-over-year basis, the prices for food in October rose less than in September, however the increase was still higher than ten per cent (10.1). Despite this reduction in growth from September, food purchased from stores continued to increase at a faster rate year-over-year for the eleventh consecutive month. 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 remained 5.2 per cent while labour force participation increased
National unemployment remained at 5.2 per cent in October, while in Ontario, unemployment also increased slight to 5.9 per cent. In the Toronto Census Metropolitan Area (CMA) – which includes Vaughan – remained unchanged at 6.3 per cent in October. Increases in the labour force nationally saw the largest increases occurring among young women and core-aged men in October. Overall, labour force growth was almost entirely accounted for by the rise in the number of people who were employed, while the total number of unemployed people was little changed. In Ontario, employment gains were led by accommodation and food services and professional, scientific and technical services.
Youth unemployment in Ontario (aged 15 to 24) increased from 11.5 to 12.9 per cent, while unemployment for adult men (25 years and adult women (25 years and over) in Ontario decreased slightly, to 4.4 and 5.0 per cent respectively.
Hourly wages for employees rose 5.6 per cent compared with the previous October, the fifth consecutive rise above five per cent. Despite the increase, the rise in wages still falls behind the rate of inflation, decreasing purchasing power for Canadians.
According to the October release of the Labour Force Survey, nearly one in ten workers reports hybrid work arranged, an increase of more than five per cent since January of this year. Data from this month’s labour force survey also indicates that while average wages have increased on a year-over-year basis, lower-wage workers were least likely to have received a raise in the last 12 months. In October, more than one in three Canadians older than 15 reported living in a household finding it difficult or very difficult to meet its financial needs. Among core-aged working people (aged 25 to 54), workers in accommodation and food services (43.2 per cent) retail trade (42.4 per cent), and transportation and warehousing (42.4 per cent) were among the most likely to reside in households facing financial strain in October. In Vaughan, these industries employed approximately 59,400 workers in 2021, representing more than a quarter of all jobs in the City.
Real Gross Domestic Product (GDP) edges up another 0.1 per cent in September, led by increases in the 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 September.
Manufacturing had its fifth contraction in six months, although September’s decrease was a slight 0.1 per cent. Durable food manufacturing rose 0.6 per cent in September, while non-durable goods fell 0.9 per cent in the same month, less by food product manufacturing which fell by 1.4 per cent. Manufacturing accounted for $4.69 billion of economic output and employed nearly 42,000 workers in Vaughan in 2021.
Construction expanded for the first time in five months, increasing 0.5 per cent in September. In 2021, the construction sector accounted for $3.94 billion of economic output and employed nearly 33,000 workers in Vaughan.
Services-producing industries were essentially unchanged in September despite a reduction across most sectors, including retail trade and wholesale trade activity. Increases in the health care and social assistance and the professional, scientific and technical services sectors largely offset the declines seen across other sectors.
LOCAL TRENDS, INVESTMENTS, AND SUCCESS STORIES
Small Business and Entrepreneurship sees demand for consultations driven by Retail Trade, Accommodation & Food Services, and Other industries in October
ED’s Small Business and Entrepreneurship top five industries seeking consultations in October were:
- Retail Trade (30%)
- Accommodation & Food Services (20%)
- Other (19%)
- Professional, Scientific & Technical Services (12%)
- Other Services (Except Public Administration) (11%)
Vaughan-headquartered Summer Fresh receives federal investment through the Jobs and Growth fund
Vaughan-headquartered Summer Fresh was one of five innovative food processing and packaging companies selected to receive a federal investment through the Jobs and Growth fund. Established in 1991, Summer Fresh manufactures more than 100 products including hummus, salads and easy meals for the North American market.
Vaughan’s agri-food and food processing sector runs “farm to fork”, with food grown, manufactured, packaged, distributed, and enjoyed in Vaughan. The City is located at the heart of the Toronto Region’s Food & Beverage sector, the largest in North America, with annual food and beverage sales in the Toronto Region exceeding $21 billion.
Vaughan-based Litens Automotive expands aftermarket activities with acquisition of controlling interest in Spanish water pump manufacturer
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.