Missing opportunities: Ontario’s urban prosperity gap

Released June 2003

The third Working Paper, Missing opportunities: Ontario’s urban prosperity gap, demonstrates that Ontario’s cities benefit from some significant advantages in demographic and creativity indices, a steady inflow of well-educated immigrants, a first-rate primary and secondary school system, and a great mix of industry clusters.

But Ontarians are missing opportunities to increase productivity and prosperity through lower aspirations, an inability to take full advantage of immigrants’ human capital, a federal fiscal framework that transfers resources out of urban regions, municipal finance and governance frameworks that need improvement, and the urban/rural imbalance of political representation federally and provincially. As a result, Ontario’s city dwellers lag $5,779 in prosperity per person behind city dwellers in the peer group of leading US states. In contrast, Ontarians living outside city regions were $937 or 3% ahead of their US counterparts. 

The Working Paper shows that Ontario student achievement scores better than international averages and well ahead of US results. “Our high school students do better on standardized tests and have higher graduation rates than their US counterparts,” said Roger Martin, Chairman of the Institute and Dean of the Rotman School of Management at the University of Toronto. “Yet fewer of these graduates are pursuing university and postgraduate degrees – by a huge margin against some states like Massachusetts, New Jersey, and Pennsylvania. This is an urban prosperity issue since cities attract more knowledge-based industries and need educated workers – who have higher lifetime earnings.”

The Working Paper also points out that Ontario and Canada are not getting the full benefit of the “brain gain” achieved from immigrants. They tend to have more advanced degrees than those born in Canada but face higher obstacles to applying their skills fully to benefit Ontario’s prosperity.

Other sources of missed opportunities identified in the Working Paper include a federal fiscal framework that transfers resources out of urban regions; municipal finance and governance structures that need improvement; and the urban/rural imbalance of political representation federally and provincially.            

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Topics: Economic policy, growth, and strategy