Quebecers are now richer than Ontarians. The gross domestic product (GDP) per capita is now higher in Quebec than in Ontario, the only other Canadian province which, like Quebec, has a large, very diversified and oil-free economy.
In 2023, Quebec’s advantage was 3%, while 34 years earlier, Ontario had a GDP per capita 15% higher. A complete turnaround, which is not due to an impoverishment of Ontario, but rather to a growth spurt in the Quebec economy.
All this will surprise many, given the widely held belief in the media and public space that the wealth of Quebecers lags behind that of their neighbors in Ontario by 10% to 15%.
The problem with this last statement is that it assumes that the purchasing power of the Canadian dollar is exactly the same in Quebec as in Ontario. However, this is far from being the case. Statistics Canada estimated in 2017, the year which serves as the basis for its price indexes, that consumer products cost 16% less in Montreal than in Toronto. You could therefore get more for your money in Montreal.
Using Statistics Canada publications, I was able to generalize this result to all of the two provinces and to all consumer and investment purchases. This allows Figure 1 to indicate that in 2023, Quebecers were on average able to purchase 3% more goods and services than Ontarians even if their per capita monetary income was lower.
Adjusting GDP per capita to take into account the difference in purchasing power between two regions that use the same currency is a well-established procedure used by international organizations. For example, the International Monetary Fund calculated that in 2023, the purchasing power of the euro for consumption and investment was 16% higher in Italy than in Germany, even though this currency is common to the two countries. Italians are less wealthy than Germans, but the gap in living standards between the two countries is less pronounced than it appears when looking solely at the difference between their per capita monetary incomes.
It is this important aspect which allows us to affirm that Quebec now provides its citizens with a better life than Ontario.
And this is largely due to the socio-economic policies put in place by the various governments that have succeeded one another since 1960.
The fruits of the Quiet Revolution
The graph above describes well the long march that Quebec’s GDP per capita has achieved in 70 years and which has finally led it to exceed that of Ontario since 2020. The evolution of the relationship between the standard of living of Quebec and that of Ontario illustrated in the figure constitute, on a small scale, a course on the economic history of Quebec since the end of the Korean War.
During the first 35 years analyzed, from 1954 to 1989, the growth of Quebec’s GDP per capita did little better than Ontario’s growth. It has experienced temporary ups and downs (Manic-5, James Bay, Expo 67, Olympic Games, recessions). Quebec’s economic delay relative to Ontario has remained essentially the same.
Education being the spearhead of the economy, the vast educational reform of the 1960s was promising, at a time when French-speaking Quebecers were among the most poorly educated populations in the West. Its effects necessarily took time to emerge, given that the entire education system, from primary to university, was established during these years of national affirmation. We had to wait a few decades for new generations to be able to fully benefit from it.
In addition, from 1970 to 1985, Quebec was faced with harsh social conflicts in the public and construction sectors. This was not conducive to the smooth running of the economy and employment.
It was only at the turn of the 1990s that the Quebec economy really took off. From 1989 to 2023, GDP per capita grew by 27% in Ontario, but by 52% — twice as much! – in Quebec. It is this growth spurt in Quebec that has allowed it to improve its standard of living and convert the 15% delay over Ontario that it fell in 1989 into an advantage of 3% in 2023.
Over the past 35 years, Quebec’s economy has been driven first and foremost by the momentum in the education of young people, and particularly young women. It benefited from lasting social peace and became international with the support of the Canadian-American free trade agreement. The Quebec economy has also become more feminized with more flexible parental leave and low-cost childcare services, which has caused a strong expansion in the employment rate. And after being temporarily slowed down by gentle provincial budgetary austerity from 2010 to 2013, then muscular from 2014 to 2016, it regained its momentum in relation to the Ontario economy from 2018 to 2023.
GDP per capita only aims to assess people’s material well-being. The latter contributes significantly to general well-being, but material wealth does not overshadow all aspects of life that can make one happy. Good health, love and friendship, harmonious family relationships, social solidarity, job security, good government, freedom from corruption and respect for the environment all add to people’s happiness. However, as the World Happiness Report the United Nations has demonstrated, there is a strong correlation between GDP per capita and the population’s level of satisfaction with the life they lead.
GDP per capita is not everything, but it is not nothing either. And in this respect, Quebec is doing much better than some public figures would have us believe.
