OTTAWA – A new economic report on Canada’s troubled manufacturing sector suggests that factories that have weathered the storm have positioned themselves for better times.
The paper from CIBC deputy chief economist Benjamin Tal points out that the sector – one of the most important to Canada’s economy and especially Ontario’s – has had a terrible time of it since the turn of the century, and even worse since the 2008-09 recession.
Since the recent crisis, manufacturing is still 10 per cent behind pre-slump highs, while one-fifth of firms just simply disappeared.
And it has gone from representing 16 per cent of the economy about 10 years ago to only 12 per cent today. That’s a worse record than in the U.S., where the sector has also been in decline.
The sector has also seen a steady decline in workers, dropping another 42,000 jobs during the December 2012 to December 2013 period.
But Tal says the pain has not been for naught. A lot of producers have spent the time not just licking their wounds, but getting leaner and meaner and preparing for the recovery. The weaker loonie, which was responsible for manufacturing’s revival in the 1990s, is also helping.
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