Alberta’s jobless factory boom (Chart)

Stats show reports of Canada’s renaissance of manufacturing have been exaggerated

Today’s release of the latest manufacturing data poked a hole in a narrative that was beginning to take hold of late, the one about a renaissance of manufacturing in Canada. After four straight months of improving sales, the latest numbers for December showed a decline of 0.9 per cent from the month before.

Many have been quick to point out that on a year-over-year basis, sales were still 2.7 per cent higher than the year before. But before getting too carried away with the story of manufacturing’s comeback, it’s worth looking at where the gains are coming from. And where they’re not.

Annual-manufacturing-sales1

Among Canada’s four biggest manufacturing provinces, the only ones to see gains last year were out west. And while Alberta’s growth wasn’t spectacular, the province has emerged as the biggest driver of Canada’s manufacturing sector in recent years. Over the last decade manufacturers in Alberta, a province with a factory sector less than one-third the size of Ontario’s, have more than made up for the declines in Canada’s largest province.  The problem, for those hoping for a blue collar job renaissance, is Alberta factories have accomplished that sales feat without adding any additional manufacturing jobs.

Manufacturing-sales-vs-emp-660x457

While manufacturing sales in Ontario in 2013 were $25.9 billion lower than they were a decade ago, Alberta factories boosted their sales by $26.7 billion. This really is astonishing when you consider manufacturing is a $270 billion industry in Ontario, compared to just $75 billion in Alberta. But while there are 323,000 fewer workers in Ontario factories today than in 2003, there are 10,000 fewer in Alberta, too.

Part of Alberta’s jobless factory boom comes down to higher productivity in Alberta, but the biggest difference is the types of manufacturing that goes on in Ontario compared to Alberta, where two-thirds of factory business is tied to the energy sector. Building trains, planes and automobiles is simply a lot more labour-intensive than constructing pipes and processing raw materials.

Manufacturing isn’t a zero-sum game. Ontario didn’t lose because Alberta won. But if you’re in the camp hoping that improving manufacturing sales in Canada will revive job growth in that sector, history isn’t on your side.




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Alberta’s jobless factory boom (Chart)

  1. The jobs are gone, and they aren’t coming back. The sooner we accept that, the better.

    • The jobs aren’t there, but open a factory and there’ll be plenty of money for you and the management you hire.

      • Govts are certainly pushed into dubious ventures because of voters, yes.

        • While bailing out Governemtn Motors buys CAW votes, it ticks off the others in this country making less with less pensions who have to pay for it.

          The reality is the general public is ignored by politicians once elected. Most people were against the never ending bailouts and inflated contracts but they happen anyways for back room deal makers using our money.

          • It saves jobs Dave.

    • True. Most will not come back until we can fix our tax inflated economy of debt fraud.

      Until Canada is more affordable to live in, and less tax/gov/union greed inflating prices for excessive wage demands….they will not be coming back.

      Take money being devalued, (1.00 / 0.90) is 11% inflation to all materials, foods, et al. Means the toilets, copper wire, studs, roofing, insulation, carpet, lino, appliances for the next home built is 11% more expensive. Means fewer people can afford them, thus less jobs to make them.

      This Ottawa government says one thing and does another.

      • Then leave

        • If my wife would come, I would be so gone. It would save me about $18,000++ a year in taxes and inflated costs. Yes, I actually worked out the taxes for US and Central America.

          But there are also issues in getting immigration if you are disabled. So I am sort of politically boxed in. Financially capable and beneficial, yes, but politically boxed in.

          • Leave her behind. She just costs money anyway.

          • That seemed like a personal and rude comment.
            Did you really feel it was necessary?

          • Sod off.

          • I’m not sure what is going on in your life so I will try not to judge.

            I remember speaking to a lady who’s husband had called me.
            She didn’t know where her husband was or when he would come back. They lived in the country and she was not sure what the closest town was. I remember telling someone I had just talked to possibly the stupidest person in Canada.

            Imagine how embarrassed I felt when later talking to her husband and he told me they were moving as his wife was suffering from dementia.

            Whatever it is – Good luck.

          • I suggest you stop commenting on other people’s behavior when you don’t know what’s going on. It seems to have tripped you up in the past as well.

          • We’ve long suspected Emily has mental health issues. I commend you for your sympathy, but in her case, it might be misplaced.

  2. It is difficult to produce manufacturing jobs in Ontario when the province charges sky high electricity rates to Ontario manufacturers, while giving away basically free electricity to their competitors in NY State and Michigan.

    The Ontario Liberal government, subsidizing American manufacturing for nearly a decade. And the guy who convinced Dalton to do this to Ontario manufacturing is now one of Justin Trudeau’s main advisors.

    • It has nothing to do with electricity.

      Skip the partisanship and focus on the situation.

      • Ontario companies don’t have to pay for electricity?

        • Deindustrialization….loss of manufacturing….rust belt, call it what
          you will…..is occuring all over the western world and has been for
          years.

          The US, the UK, Germany….

          It has been occurring HERE officially since at least 1991 when Deputy Liberal Leader Sheila Copps was quoted as saying, ‘We are witnessing the de-industrialization of Canada’

          And focussing on local partisanship and campaign crap won’t solve the problem.

      • Electricity is part of the equation, although grants a small part it is indicative of the big picture of inflated governemtn costs making us uncompetitive.

        While we blew billions on defunct inefficient and wage inflated auto industry, China built the Yanze dam for 3.5 cent per KW electricity which makes them more competitive for more of our jobs.

        Why pay 29 cents a KWH in Ontario when you can get electricity for 3.5 cents a KWH in China? Now get these efficiencies in less taxes, less governemtn waste, less money for nothing programs of waste…across the whole spectrum of costs….and tax inflated Ontario is not an economical place for most manufacturing. So you get less jobs.

        We are a tax inflated economy of debt fraud and bloated government making us less competitive. Want jobs? Reduce tax inflation and it will reduce excessive wage pressures and with more money to spend, more to spend on each others jobs.

        Government can’t solve the job/economic problem as they are the problem.

    • There is no difference between Liberals, NDP and Conservatives. They all want more of our money to do less and less for it.

      We don’t have god options on the ballot for our own economic liberty. Just less money and tax inflation so we have less money to employ each other doing constructive things. But government loves its myths to lift our money. Tax and inflate prices more with taxes, I have less to spend on someone else’s job.

  3. Only way to make manufacturing viable is to automate. Chinese/Taiwan/Japan/Korea/Philippines and more automate even though labour is cheap because automation done right increases quality, reduces waste, reduces costs and provides enough profit to keep a company in business.

    Also means lower costs for the consumers, so more people can afford the goods and services related to it. Hey, no one is going to buy excessively expensive Government Motors Union low quality high cost autos so they can make the kind of money union wants with low productivity.

    Fact is higher costs to consumers means they will have less to spend on each others jobs.

  4. Another fine example of western provinces doing better than eastern provinces. Has nothing to do with more conservative governments in the west. Nothing. At. All.

    • -
      Rick,
      My favourite story is about Christy Clark’s kid the evening of the election when his mom mopped the floor with the media elites and the NDP leaches.

      Christy Clark told the kid he didn’t have to go to school the next day as the election had taken away so much of her personal attention and they could relax together in the morning.

      The kid answered “heck no mom, I’m going to school and I’m going to put it to all those people who laughed at me and said bad things about you”

      I am proud to be from Western Canada. And once it warms up I will be happy to come back.

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