For too many years, the story of Windsor has been one of decline. As the fortunes of the auto industry waned, so did Windsor’s economy.
The city’s unemployment rate hovered above that of Ontario and Canada for the decade between 2006 and 2016. In all of Canada, it took about two years for the number of employed workers to rebound after the 2008-09 financial crisis, and only slightly longer in the province of Ontario.
As the accompanying chart shows, Windsor had a more difficult path. Employment was already falling by the time of the financial crisis, and it did not rebound to its pre-crisis high (in August, 2006) until 2018. That is Windsor’s lost decade.
Not surprisingly, Windsor grew poorer during that time. In 2005, it had the 11th highest median household income in Canada, and the seventh highest in Ontario, according to an analysis by the Fraser Institute. That reflected Windsor’s status as not only a hub of the auto industry, but also its location amid some of Canada’s most productive farmland.
Fast forward to 2023, and that prosperity has faded. Windsor now ranks a distant 33rd on median household income. The decline is not just on a relative basis; median household income fell by 7.1 per cent in inflation-adjusted terms.
If the story of Windsor ended there, it would be anything but a happy one. But there is a new chapter emerging, with the (lavishly subsidized) effort to jump-start an electric-vehicle industry in southwestern Ontario. NextStar, the joint venture between LG Energy Solution and Stellantis, is scheduled to begin production of EV batteries next year, adding 2,500 jobs. Slightly farther afield, the Volkswagen plant in nearby St. Thomas, Ont., will add 3,000 permanent positions when it opens in 2027, according to Ottawa.
The benefits to the national economy of such subsidies are dubious, but there is no doubt that the Windsor area will be a big winner. Those thousands of jobs will bring money, and families, to the region.
Even before those plants were announced, Windsor’s economy had been on an upswing, helped along by major construction projects such the Gordie Howe International Bridge and, in a couple of years, a new hospital. This fall, the city’s unemployment rate has largely closed the gap with that of the province and the country as a whole.
It all adds up to a new direction for Canada’s southernmost city. “What we’re seeing now is the transition from being a big small city to a small big city,” Mayor Drew Dilkens told The Globe and Mail’s editorial board earlier this fall. But with growth comes new problems, all too familiar to larger urban centres.
The homeless population has been rising in recent years, and Windsor finds itself in the same bind as many Canadian cities that are struggling to cope with similar surges: the strains are local but the necessary resources are at the provincial level.
Crime rates, particularly for non-violent offences, are on the decline after a surge in 2018. But Mr. Dilkens says there is a public disorder problem that isn’t showing up in those statistics, driven in part by those suffering from mental illness or addiction.
Revitalizing the downtown (as is the case across Canada) is also a big challenge, particularly since Windsor was already grappling with that issue before the pandemic.
Housing prices are on the rise. While costs are still low relative to most other urban Ontario markets, affordability is emerging as a concern. And then there is the question of urban sprawl. Mr. Dilkens is clearly no fan of the kind of housing density that would preclude the need to pave under farmland as the city’s population grows. Windsor has yet to figure out how to avoid the fate of other Canadian cities that have oozed into the countryside in response to housing pressures.
The housing issue underscores the fundamental choice facing Windsor as it starts to write a more hopeful chapter: Will it simply repeat the mistakes of other cities? Or will Windsor find a better path – a small big city that is a model for smart urban development.