Ontario’s regulated commercial online gaming industry has so far generated more than $4 billion in economic value for the province and is “outpacing initial expectations,” according to a new report from Deloitte and iGaming Ontario (iGO).

The analysis found that year two of the Ontario regulated iGaming market yielded $2.7 billion in gross domestic product (GDP). That is 70% more than the $1.6 billion reported in year one.

Remarkably, this means that after just two years, the province’s online gaming industry is already closing in on the year-10 GDP projection of $4.7 billion published in last year’s report. The new analysis did not provide an updated long-term forecast.

The report estimated that Ontario iGaming raised more than $1.2 billion in government revenues between April 2023 and April 2024. Nearly $800 million of that was provincial revenue, $380 million was federal money and $75 million went to municipal governments. That was also up significantly from the total of approximately $700 million in government revenue generated in year one and takes the two-year total government revenue contribution to around $2 billion.

This Deloitte and iGO report comes two months after iGO reported that Ontario online gambling sites generated $2.4 billion in revenue from $63 billion in wagers in the market’s second year, year-over-year jumps of 71.4% and 78%, respectively. iGO Executive Director Martha Otton noted at the Canadian Gaming Summit on Wednesday that while that gross gaming revenue growth is impressive, “the bigger and better story is what gaming is doing for the broader economy.”

It’s worth noting that Ontario Lottery and Gaming’s activity and the contribution that makes to the Ontario economy is not included in these reports.

Job creation gathers pace

Of the $2.7 billion in GDP produced in year two, nearly $1.3 billion was in the form of wages and other labour income, up 45% from year one. The industry created just short of 15,000 jobs in year two, more than the 12,000 in year one.

The report estimated that in year two, online gaming operators directly employed 2,675 full-time equivalent workers with an average salary of over $122,000 dollars, 60% higher than Ontario’s average annual gross income.

The majority of the $2.7 billion in GDP ($1.3 billion) and the 14,935 jobs (9,295) was derived from what Deloitte calls “indirect contribution.” That is defined as the contribution resulting from iGaming operators’ demand for goods and services from other industries, such as advertising, marketing and technology.

Ontario approaching year-five targets after just two years

As well as the total of around $4.3 billion in GDP approaching Deloitte’s initial year-10 GDP forecast of $4.7 billion, the Ontario iGaming market has hit or nearly reached many of Deloitte’s year-five projections in just its second year, with government revenues (94% of the five-year projection in two years), direct jobs sustained (120%), total full-time jobs sustained (92%) and GDP contributions (93%) “outpacing initial expectations,” per the report.

It essentially means that, per the initial estimates, Ontario’s regulated iGaming market’s performance is three years ahead of schedule.

Deloitte also notes that for every dollar spent by iGaming operations, an estimated $1.40 of GDP was supported in the Ontario economy, up from $1.14 in year one.

“Our made-in-Ontario iGaming sector is being recognized internationally for its success as a leader in this space,” said Attorney General Doug Downey. “Working together with our partners and industry, we will continue to drive innovation and deliver robust player protections, all while displacing the unregulated market.

“Our iGaming sector is not only a job creator here in Ontario but it shows the world our ongoing commitment to building a sustainable and responsible iGaming industry.”

Otton noted that at some point, these numbers will have to plateau. “Year over year, it’s unrealistic to expect that we’ll see growth of over 70% so we’re definitely not expecting that,” she said. “But, to be frank, we’re not seeing the levelling off yet.”