Rebecca Cook / Reuters Unifor president Jerry Dias addresses General Motors workers protesting GM's plan to close its Oshawa assembly plant, at a rally in Windsor, Ont., Jan. 11. The decline of Ontario's manufacturing base is the principal reason why the province is seeing meagre wage growth and a decline in income mobility, a new report from the FAO says.

MONTREAL — In the wake of General Motors Canada's announcement late last year that it's shutting down its iconic Oshawa assembly plant, a new report from the provincial finances watchdog highlights the damage done to Ontario's households by the decline of manufacturing. The report on income trends, from the provincial Financial Accountability Office (FAO), found that Ontario has had far and away the worst wage growth of any province in recent decades. After-tax incomes in Ontario grew an average of just 0.5 per cent between 2000 and 2016, compared to an average of 1 to 2 per cent for all other provinces. Watch: Ontario's auto industry will be gone by 2030, analyst predicts. Story continues below.

Had it not been for federal and provincial government transfers to low-income and elderly households, Ontario's incomes would have actually declined in that time, the only province to have seen a drop in the wages paid by employers. Even with help from taxes and transfers, some groups saw a decline in their incomes, namely working-age people living alone and single-parent households, the FAO report found. Ontario's median income growth slowest among provinces between 2000 and 2016

Financial Accountability Office of Ontario After-tax income growth (in green) was the slowest in Ontario from 2000 to 2016. But market incomes (the wages paid by employers) actually shrank over that time. Only government transfers kept Ontario's inequality from increasing..

Without government intervention, Ontario would have seen a substantial increase in inequality since 2000, the report concluded. It also found that "income mobility" is declining in Ontario, meaning it's becoming harder for the poor to escape poverty, and easier for the rich to stay rich. In 1987, more than four in 10 Ontarians had climbed up to the next wage rung on the income ladder in the previous five years. By 2016, only 31 per cent of Ontarians had been able to do the same. Achieving upward mobility has become more challenging in Ontario

Financial Accountability Office of Ontario Ontario's income mobility is on the decline. In 1987, 41 per cent of Ontarians had climbed up at least one quintile on the income ladder in the previous five years. By 2016, that had dropped to 31 per cent.