A report prepared for the Ontario Manufacturing Council concluded that 582,000 direct and indirect jobs would be lost in Canada over the next five years if the Big Three US automakers closed their operations in the province of Ontario.
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If output halved, 296,000 jobs would be lost nationally, the report said, according to Agence France-Presse.
“The economic consequences of either a partial or total shutdown of the Detroit Three are stark,” the report added.
“Either scenario is sufficient to push Ontario into a deep recession while the nation may barely escape one in the 50% reduction scenario.”
Initial job losses of between 157,000 and 323,000 at assembly plants, parts manufacturers and others, depending on the scenario, would rise to between 296,000 and 582,000 by 2014, the report said.
The job losses would continue to mount after the first year because a weaker economy would depress investment, discourage immigration and half new housing construction, leading to a negative economic spiral.
According to Agence France-Presse, the auto sector and parts industry employ roughly 219,000 Canadians nationwide while the Big Three directly employ about 34,000 and overseas car makers employ just under half that number. Toyota and Honda have plants in Ontario; Toyota has just opened a second.
“If we think that the extinction of the auto industry is a national economic evolution, this report says that is a mistake,” Ontario economic development minister Michael Bryant was quoted as saying.
“We won’t let that happen because of the catastrophic effects that are laid out in this report,” he told Agence France-Presse, describing the demise of Canada’s auto sector as “the economic equivalent of a nuclear freeze with catastrophic effects that would knock us into a deep recession.”
