CLEVELAND OHIO, CHICAGO ILLINOIS and TORONTO, ONTARIO--(Marketwired - Apr 11, 2013) - The Great Lakes region is a vital driver of North American economic output, employment and trade, accounting for nearly a third of combined Canadian and U.S. output, jobs and exports, according to a new report on the region from BMO Economics. While the region was hit hard during the "Great Recession", economic activity has since turned around and is now shifting into a higher gear.
The report was presented at the launch of the new Council of the Great Lakes Region by Doug Porter, Chief Economist, BMO Capital Markets.
"The economic importance of this region can't be overstated," said Mr. Porter. "With economic output of US$4.7 trillion in 2011, the region accounts for 28 per cent of combined Canadian and U.S. economic activity. It would rank as the fourth largest economy in the world if it were a country, behind only the U.S., China and Japan."
After a harsh downturn between 2007 and 2009, Mr. Porter stated that the region has bounced back - helped especially by the resurgent auto sector. "North American car and truck production is back to pre-recession levels, global demand for machinery and equipment has firmed and the service sector remains sturdy."
Mr. Porter noted the important role of governments in the region in ensuring economic momentum continues. "Measures by policymakers to improve trade flows and to foster overall growth in the region are key for the long-term health of the broader economy."
The report, released today, states:
• The region's highly diverse economy supports employment across a wide range of manufacturing and service industries.
• While manufacturing employment is down about 25 per cent from levels seen a decade ago, education & healthcare (+23 per cent) and professional services (+12 per cent) have helped make up the shortfall. In fact, education & healthcare now make up nearly 18 per cent of employment, while retail & wholesale trade, government and professional services also carry double-digit weights.
• The region's states were the origin of 24 per cent of total U.S. merchandise exports in 2012, while Ontario accounted for a hefty 38 per cent of Canadian shipments.
• The North American Free Trade Agreement has certainly helped to grease the trade relationship in the region, but more can be done to enable the efficient movement of goods, especially given how integrated the supply chain has become.
• The Beyond the Border Action Plan is one positive, carried out jointly by the U.S. and Canadian governments to combat post-9/11 border thickening and to improve trade flows. Among the measures are increased value thresholds for expedited customs clearance, preclearance initiatives for commercial cargo and improved border infrastructure.
The full report can be found at: http://www.bmonesbittburns.com/economics/reports/20130411/greatlakes1304a.pdf
About BMO Financial Group
Established in 1817 as Bank of Montreal, BMO Financial Group is a highly diversified North American financial services organization. With total assets of $542 billion as at January 31, 2013, and more than 46,000 employees, BMO Financial Group provides a broad range of retail banking, wealth management and investment banking products and solutions.