I N D U S T R Y  -  M A N U F A C T U R I N G   &   P R O C E S S I N G

Context

This sub-sector includes a wide range of industry types – automotive, food processing, chemicals, steel, etc. – which require technical consulting services. While many of those services, such as building envelope design, municipal development approvals and site servicing are generic in nature, most require an in-depth knowledge of the unique attributes of the particular business type, and even the specific enterprise. This is particularly evident in their requirements for environmental management and permitting/approvals, where the unique characteristics of the manufacturing systems or processes need to be fully understood in the design of pollution/waste management facilities and in regulatory approvals.

Drivers

The manufacturing and processing sub-sector is driven by domestic demand and exports. Global competitiveness is the key driver, which in turn is driven by labour productivity and capital investment levels. The auto sub-sector dominates, and while there is competitive pressure on North American vehicle manufacturers, foreign brands have found Canadian locations to be attractive. Skills training and education levels, our health care system and political stability are often cited as attractors to manufacturing investment. The most dominant factor, however, is the health of the US economy, as it remains the largest market for our manufacturing sector.

Outlook

At any given month or year, forecasts for the health of the Canadian manufacturing sector are either tremendously optimistic or pessimistic. However, over time, the relative share of economic activity associated with manufacturing and processing reflect similar levels of gradual decline as experienced in other developed countries, as services increase in their relative proportion of economic activity. Producing more with less has been the long-term trend. To do that, capital investment continues in the sector. As well, regulatory involvement related to environmental performance and worker health and safety show no signs of weakening. The continued need for capital investment and environmental management programs appears assured.

Changing Client Needs

As with other sub-sectors of the Canadian economy, clients are focusing more on their core business, and outsourcing support activities. The managerial methods by which they do this are becoming increasingly sophisticated, ranging from the preferred supplier programs of the auto sector, to turnkey or design-build solutions for plants and facilities.