Ontario could avoid recession this year, even as tariffs take hold, fiscal watchdog says | CBC News

"The data is part of the latest update from the province's Financial Accountability Office (FAO). It highlights Ontario's economic struggles between April and September in the months immediately after U.S. President Donald Trump's tariff policies were imposed. It also delves deeper into the province's shrinking manufacturing sector, which the FAO says has shed approximately 20,600 jobs over the past two years and has been put under increased pressure because of the trade war."

"Ontario's real gross domestic product (GDP) growth, a wide measure of economic activity, decreased by 0.6 per cent during the second quarter of the year due to a significant drop in exports and sharply lower business investment, the report notes. Ontario's financial accountability officer, Jeffrey Novak. (Ontario Legislature) Ontario could avoid 'technical recession': FAO The report contains projections for the third quarter which suggest Ontario may avoid a technical recession, defined as two consecutive quarters of real GDP declines."

"While the report notes the overall economy is little changed, lower than anticipated job losses and gains in retail sales and manufacturing sales could help the numbers. But Novak said his office will be watching the data closely as it comes in. The economic uncertainty being felt by many employers is still translating to job losses, he said. For Ontarians, depending on where you are situated in the job market, the job market is weak, Novak said."

The Financial Accountability Office reports Ontario's real GDP fell 0.6% in Q2 driven by a sharp drop in exports and a marked fall in business investment. Manufacturing has shed about 20,600 jobs over two years and faces increased pressure from the U.S.-Canada trade dispute. Projections for Q3 suggest Ontario may avoid a technical recession if weaker-than-expected job losses and gains in retail and manufacturing sales persist. Economic uncertainty among employers continues to translate into job losses, and unemployment averaged 7.8% between April and September after steady increases since early 2023.

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