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Manufacturing Industry Forecast Calls for Improved Conditions but Concerns Over Skills, Regulatory Burden Linger

Published by Brad Fougere on October 07, 2014

Sun with cloudy periods and a chance of a severe storm.

That's the economic forecast for Canadian industry, according to a survey commissioned by Canadian Manufacturers & Exporters (CME) and Food & Consumer Products Canada (FCPC).

Overall, some companies are optimistic about the future in terms of profitability, expanding global markets, hiring more workers and investment in machinery and equipment as well as research and development, according to the bi-annual Management Issues Survey.

However, the storm clouds on the horizon come in the form of overall uncertainty, increasing labour shortages, rising input costs and a regulatory system that is becoming more burdensome and expensive.

"This new sense of optimism is good news as we can see companies starting to reap the benefits of a growing US economy and lower dollar," said Jayson Myers, CME president and CEO. "But it's cautious optimism. There are still many storm clouds on the horizon and the message is business as usual is simply not an option."

And this is echoed by what is often called Canada's recession-proof sector, food and beverage manufacturing.

"Canada can and should be a global leader in food and beverage manufacturing, but a number of factors, such as rising costs and an outdated regulatory environment are holding us back," said Nancy Croitoru, president and CEO of FCPC. "The number of Canadians working in our sector is declining, companies are cutting costs and any growth is happening at half-the-rate of overall manufacturing, which is dampening the outlook for our sector."

In terms of global business, the US will still remain the main destination for Canadian products today and over the next five years, but Canadian companies are also looking at South and Latin America and the EU as target markets.

At a time when governments around the world are competing fiercely for manufacturing investments, there is widespread concern that Canada is often just not in the game. In fact respondents to the survey clearly indicated that they felt governments were restricting their ability to grow - 46 per cent federally, 55 per cent provincially and 72 per cent municipally.

"Canada's manufacturers and exporters realize that they cannot rely on governments to solve their problems for them and that they must transform to prosper," Myers added. "But governments must be willing partners by keeping taxes and low and removing obstacles to growth."

Other jurisdictions outside our borders are competing hard for our business and it's imperative Canada keeps up if we want to see our sector to thrive," added Croitoru.

The survey uncovered that programs like the Accelerated Capital Cost Allowance are integral to the competitiveness of the manufacturing industry, but the uncertainty of the program is a problem as highlighted in the survey.

The survey, conducted every two years, was carried out during August and September and had 803 respondents, from every sector and size of company. The survey was commissioned in partnership with BDO, HSBC, RCAP and BlackBerry.

For full survey details, visit

About Us:

Canadian Manufacturers & Exporters (CME) is Canada's largest trade and industry association, and the voice of manufacturing and global business in Canada.

Visit us at or follow @cme_mec on Twitter to learn more.

Food & Consumer Products of Canada (FCPC) is Canada's largest industry association representing the companies that manufacture and distribute the vast majority of food, beverage and consumer goods found on store shelves and in people's homes.

Learn more at and follow us at @FCPC1.

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