Canada’s manufacturing sector, which employs upwards of two million people and accounts for about 17 per cent of the nation’s GDP, is under siege due to high energy costs, a rise in the Canadian dollar, and intense competition from lower-cost countries like China.
Roughly 200,000 jobs — most of them in the manufacturing heartland of Ontario and Quebec — disappeared in 2005 and 2006, and the outlook for 2007 isn’t much better. Major restructurings are well underway in key sectors such as automotive and forestry, as companies try to reduce operating costs and increase efficiencies.
But the Edmonton region — Alberta’s manufacturing hub — is bucking the national trend. With $30 billion worth of regional upgraders and another $100 billion of oilsands projects in the pipeline — more than $30 billion of which are already underway, or set to start — most local manufacturers see another busy year ahead.
The Conference Board of Canada is also bullish. It expects Edmonton’s economy to grow by 3.6 per cent in 2007, with the local manufacturing sector expanding at an even healthier 4.2 per cent clip. Meanwhile, with activity levels softening in Ontario, Quebec and the Maritimes, Eastern manufacturers are scouring for opportunities to participate in the oilsands boom.
Challenges? There are many, including chronic skilled labour shortages, the likely imposition of greenhouse gas emissions caps on the energy sector, and continued political in-fighting between the 23 municipalities that comprise the Edmonton region.
But if these challenges are managed effectively, the Edmonton region is poised to become the single most important manufacturing region in Canada, west of Metro Toronto, over the next decade.
About our presentor:
Gary Lamphier has been a business columnist with the Edmonton Journal since May of 2002. He has spent most of the past 30 years working as an editor or reporter with a variety of newspapers and magazines, including The Wall Street Journal, The Globe and Mail, the Vancouver Sun and the Financial Times of Canada. He also worked as a corporate communications consultant for nearly five years, advising roughly two dozen TSX and Nasdaq-listed firms. Gary and his wife Toni have been married for 27 years and have two children, Devon and Connor, both now attending university.
