Quebecers are just as rich as Ontarians when we consider their purchasing power, according to the Institute for Socioeconomic Research and Information (IRIS), which believes that the Legault government is targeting the wrong target by wanting to catch up with the neighboring province on the economic plan.
If the gross domestic product (GDP) per capita is lower in Quebec than in Ontario, IRIS underlines that the purchasing power of Quebecers is equivalent to that of Ontarians. “Quebec does not really lag behind Ontario in terms of wealth,” commented researcher Guillaume Hébert of IRIS in an interview.
The left-wing think tank cites the work of economist Pierre Fortin, who highlighted that the purchasing power of Quebecers was 0.6% higher than that of Ontarians in 2022.
Last June, Mr. Fortin also explained that the purchasing power of Quebecers had experienced significant catching up since the 1980s. In 1980, the purchasing power of Quebecers represented 80% of that of Ontarians.
It is now relatively equivalent, at 101%. “From 1990, Quebec’s catch-up was rapid and persistent,” said Mr. Fortin during a conference organized by the firm BCF Avocats d’affaires.
Remember that Quebec’s real GDP per capita is 13% lower than that of Ontario. The Legault government wants to reduce the gap to 10% by 2026.
GDP per capita is used to compare wealth between two jurisdictions, whose populations are not of equal size. A lower GDP per capita would indicate that Quebec workers produce less wealth than their Ontario counterparts.
Taking into account the industrial fabric of the two provinces, Mr. Hébert affirms that Quebecers are just as productive as Ontarians. For a comparable industry, Quebecers would not produce less wealth. “The way to respond to this situation is not necessarily to say that Quebecers must be more productive. »
The Legault government is setting the wrong target by wanting to catch up with Ontario’s GDP per capita, argues IRIS one week before the unveiling of the provincial budget.
Mr. Hébert emphasizes that GDP does not take into account the distribution of wealth in the population, the well-being of its residents or the environmental damage caused by certain industries.
“We must not lose sight of the fact that simply catching up with Ontario’s GDP per capita could lead us to further degrade, in fact, the economy or the general situation of Quebecers.
“If we only aim to grow GDP, but without thinking about the social and environmental benefits, we could close part of the gap that separates us from Ontario, but it would be possible that the population would not be able to do so. not in a better position,” adds the researcher.