Study shows COVID-19 economic impact on the Canadian manufacturing sector

Sales, new orders, employment, and hours worked all significantly affected

TORONTO (May 25, 2020) – A new Canadian Manufacturers & Exporters (CME) survey of 320 manufacturers across the country reveals that the economic impact on the industry is even worse than expected. Survey highlights include:

• 2 of 3 of manufacturers report that their rate of output has fallen below normal since the onset of the COVID-19 crisis.
• A similar proportion expect output to remain below normal for at least the next 3-6 months.
• 1 of 4 manufacturers are reporting a drop in sales of more than 50 per cent
• Nearly 1 of 4 manufacturers have scaled up or retooled their operations to build products and components necessary to help in the fight against COVID-19.
• Some 80% of firms rate the federal and provincial government responses to the crisis as excellent or good.

“Even though we are seeing signs that the economy is re-starting across the country, recovery is still far away,” added Darby. “Large businesses are not eligible for many government relief programs and they report more damages currently and, are less optimistic about the future. This is concerning considering the importance of large businesses on manufacturing supply chains. Big business keeps SMEs in business by buying from them, generating economic spin-offs, and creating jobs.”

“It is critical that the government extend and broaden its emergency support programs including the Canada Emergency Wage Subsidy, which is helping more than half of the respondents to stay afloat and keep employees on the payroll,” stated Darby. “Governments should consider rolling out measures to spur consumer spending, especially of Canadian-made products. CME looks forward to work with the government on implementing soon-to-be released recommendations to facilitate economic recovery based on the results of this survey.”