The financial services sector: a source of growth for Canada’s economy

- Economic News
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OTTAWA, Nov. 26, 2015 /CNW/ – The financial services sector directly accounted for 780,000 jobs and 6.8 per cent of Canada’s gross domestic product (GDP) in 2014, according to a new Conference Board of Canada report released today.

“The financial services sector has been a strong source of growth for the Canadian economy over the past decade,” said Michael Burt, Director, Industrial Trends, The Conference Board of Canada. “The sector’s employment, financial results, and international trade and investment performance, have outpaced the average for all other sectors.”

Highlights

 

The report, An Engine for Growth: 2015 Report Card on Canada’s and Toronto’s Financial Services Sector, reveals that Canada’s financial services sector is heavily concentrated in Toronto and this trend is on the rise. For example, more than 30 per cent of all financial services headquarters are located in Toronto, which is more than double the share of Vancouver (13.2 per cent), its closest competitor. As well, the share of financial services employment in the metro Toronto area has risen from 28.2 per cent in 2004 to 32.3 per cent in 2014. Finally, the sector is very important to Toronto’s economy. It directly accounts for 13.3 per cent of metro Toronto’s GDP. Only the public services sector is larger.

Not only is Toronto the largest financial centre in Canada, it ranks highly compared to other global financial centres. The Banker magazine ranked Toronto seventh globally and second among financial centres in North America.

In addition to the direct economic effects, Toronto’s financial services sector also generated indirect effects in key industries including consulting, accounting, legal services and computer services. Once the indirect impacts are added, Toronto’s financial services sector supported 358,000 jobs in the metro Toronto area. In terms of tax revenues, the Conference Board estimates that Toronto’s financial services sector generated a combined $15.7 billion for the federal, provincial and municipal governments.

The report, An Engine for Growth 2015 Report Card on Canada’s and Toronto’s Financial Services Sector, was funded by the Toronto Financial Services Alliance and is available from the Conference Board’s e-Library.