Regional Economic Impact

The Windsor Essex COVID-19 Economic Task Force conducted a Business Impact Survey between March 22-April 8, 2020 to assess the impact to local businesses, their needs, as well as their capabilities as it relates to providing services and products for the Government of Canada's fight against against COVID-19. Follow the link below for an interacitve report on the survey resuts.

 

 

The economic impact of COVID-19 is widespread, causing a world-wide recession. No one is certain whether this crisis is a short-term impact or one that will be long-standing, but, the health and safety of individuals is of greatest priority. As such, any measure to help stimulate the economy is complicated because normal measures to support increased economic activity are counter-intuitive in a time where social containment is necessary. Instead, supportive economic measures focus on providing access to information and access to capital liquidity to help affected businesses buffer business slowdowns.

There are a number of economic sectors that have already suffered economic stress. These sectors include: travel-related businesses like airlines and cruise lines due to the global restriction on travel; the restaurant/entertainment sector due to government-sanctioned quarantines or individuals opting to limit social interaction; tourism-related businesses; and the manufacturing sector that relies on a global supply chain. Some businesses are capable of coping by implementing “working from home” policies but many businesses, particularly small businesses cannot.  And, many businesses do not have the means to cope with economic disruption if key employees get sick or are required to self-isolate.

Given the importance of an open border between Canada and the U.S. and the importance of international trade, the Windsor-Essex region may be particularly at risk if the secure, efficient, effective and safe movement of goods, services and people is disrupted in any manner. On March 15, 2020, the Government of Canada announced a travel advisory for all international travel, including travel to the U.S. On March 16, 2020, The Government of Canada has barred entry to all travellers who are not Canadian citizens, permanent residents of Canada, or U.S. citizens. As of March 16th, borders will remain open to commercial goods to and from the United States. In order to enhance screening, international flights will only be permitted to land at Montreal, Toronto, Calgary, and Vancouver. Enhanced screening will be deployed at all Canada Border Services Agency (CBSA) all other ports of entry into Canada.

Some points for consideration:

  • The Windsor-Detroit trade corridor is one of the busiest commercial border crossing in the world; it is estimated that more than $450 million in goods cross the Windsor–Detroit border every day, representing one-third of all surface trade between Canada and the USA;
  • Windsor-Essex is Canada’s only census metropolitan area that shares a border with a US metropolitan area and this binational area is at the core of one of North America’s major trade and transportation corridors;
  • More than 6500 people residing in the Windsor-Essex area work outside of Canada, nearly all of whom commute across the Windsor-Detroit border.  This number is more than 4X greater than the next Canadian metropolitan area;
  • Windsor-Essex boasts an industry profile of more than 1000 manufacturers, $4.5 billion of manufactured goods produced in annual GDP – 30% of the region’s total GDP production, 90-plus auto and parts manufacturers and an excess of 250 machine, tool, die and mold companies which are all key components of the integrated global value chain;
  • Windsor-Essex is home to the largest auto cluster in North America. Vehicle parts cross the border an average of seven times before finished vehicles roll off the lines; and
  • 70-80% of Ontario’s greenhouse produce is exported to the United States. There are over 3,200 acres of vegetable greenhouses in Ontario with approximately 2,600 acres (or 80%) in Windsor-Essex.
  • Ontario agriculture exports to the U.S in 2016, totaled $683.5 million; and
  • Caesars Windsor, a temporary closure of all casinos in Ontario was announced by the Ontario Lottery and Gaming Association on March 16, 2020, affecting about 3000 employees in the Windsor-Essex Region

Manufacturing Sector:

  • There are over 250 machine, tool, die & mold companies representing over 7, 500 local jobs; Over 90 automotive and automotive parts manufacturers that would be directly affected by a tariff on assembled vehicles and parts representing almost 13,000 local jobs;
  • Multiplying the number of jobs by the average wage in these two key industries (machine, tool, die and mold and automotive and parts manufacturers) pay a total of almost $1.3 Billion in total wages to employees in Windsor-Essex;
  • These jobs cannot be performed from home and they rely on the relative free movement of goods and services across national borders;
  • In total, the number of individuals employed in manufacturing is over 21% of the region’s total employment and any economic slow-down by these workers will be felt across the entire Windsor-Essex region because most of these individuals spend most of their money locally.

Tourism Sector:

Almost five million visitors selected the Windsor-Essex region as their tourist destination, contribution $500 million into the economy annually and supporting 16,000 jobs in the sector.

  • Windsor-Essex region has many unique characteristics that are especially attractive to visitors and it also has several amenities and attractions including (but not limited to):
    • Wineries and agri-tourism
    • A variety of outdoor experiences such as fishing, boating, eco-tourism, along with being a world-class birding destination; and
    • Gaming and nightlife.  A highlight for the region is Caesars Windsor which has anchored a tourism sector that has historically generated above average economic activity.
    • Food & Drink - celebrating local.
    • Arts & Culture - our heritage, our story.
  • These attractions rely on visits from tourists outside of the Windsor-Essex region, particularly U.S. tourists given the proximity.
  • These tourist attractions are also supported by a web of businesses.

Transportation and Warehousing Sector:

  • The Transportation & Warehousing Sector in the Windsor-Essex region is an important economic driver.  There are over 2,600 businesses in the Transportation and Warehousing sector employing over 10,000 workers in Windsor-Essex.