Although the recession is hitting Ontario hard, many predict Ottawa will escape from the brunt of the economic turmoil.

While Ottawa's tech sector is experiencing massive layoffs, economic downturns tend to spare those working in the capital, where approximately 20 per cent of the workforce belongs to the public service.

Even with massive layoffs announced at Nortel this week, the province's economic development minister says the highly-educated, motivated workforce in the capital could help the region become an economic hot spot.

"Ottawa has a particularly high percentage of people with the training and background and skill-set to allow this to be an economic hot spot in the coming years," Michael Bryant said during a breakfast address in Ottawa.

At Planet Coffee in Ottawa's Byward Market, the brewing and selling of coffee hasn't changed.

"Business has been great. Nothing seems to have changed for us. It seems to be status quo. We're doing pretty much the same numbers that we did last year," said France Desfosses.

"People seem to talk about a little bit -- not as much going out for dinner, sort of maybe saving up a little bit in case the worst is yet to come, but not a huge impact," she said.

Still, that doesn't mean Ottawa is immune from the plague of the recession. It only means the effects are felt less here and often later than the rest of the province.

In January, massive job losses pushed the country's unemployment rate up 0.6 percentage points from December to 7.2 per cent.

In Ottawa, the unemployment rate dropped to 4.5 per cent in January from 4.6 per cent the month before. Ontario was hardest hit, losing 71,000 jobs across the province.

Now, TD chief economist Don Drummond is predicting Ontario will run a deficit of about $5 billion in the current fiscal year ending March 31, and another $13 billion in the next.

Even with all the speculation, Premier Dalton McGuinty is keeping a tight lid on just how deep Ontario will sink into red ink.

"All I can say is what I've said before: the numbers will come out in the budget itself," he said on Friday.

The Ontario budget will be delivered on March 26.

With a report from CTV Ottawa's Norman Fetterley files from The Canadian Press