Manufacturing our future: A manufacturing strategy for Canada

CANADA NEEDS A STRONG AND GROWING MANUFACTURING SECTOR

For years, CME had cautioned governments about sluggish manufacturing activity in Canada and have been working on implementing solutions with them.

Output and exports of Canada’s manufactured goods have grown at much slower rates than in other developed countries, and this is largely due to a steady decline in manufacturing investment that started in the early 2000s. In recent years, Canada has ranked near the bottom across the Organization for Economic Cooperation and Development (OECD) when it comes to growth in machinery and equipment investment and in productivity.

This long-term erosion of our industrial competitiveness directly impacts the ability of manufacturers to respond to future crises. As such, while public attention is now being focused on ensuring Canada is better prepared for the next crisis, it is critical that the actions taken for the manufacturing sector allow it to both survive in the short term and prosper long-term.

Leveraging Canadian manufacturing for long-term prosperity

Now, rather than asking what is made in Canada, the question has become: why are more things not made in Canada and how can we reverse this trend?

To achieve this, governments must work with industry to implement a three-phase recovery and growth strategy. This three-phase strategy should mirror the following steps to allow Canada to grow out of the short-term collapse and into long-term prosperity:

PHASE 1: RESPOND

1. Fix outstanding access issues with the wage subsidy and the commercial rent subsidy programs.
2. Implement a rapid arbitration process for companies who were denied access to relief programs.
3. Spur consumer spending through “Cash for Clunkers”, a home renovation tax credit, and a three-month sales tax holiday.

PHASE 2: RECOVER

1. Develop and support a Made-in-Canada strategy to boost sales of Canadian-made goods at home and abroad.
2. Increase infrastructure spending and leverage government procurement by basing purchase decisions on total economic value to Canada, not just price.
3. Encourage business investment by re-funding investment support programs and grant programs.

PHASE 3: PROSPER

1. Improve Canada’s global investment competitiveness by lowering the cost of doing business.
2. Implement a value-added natural resources development strategy.
3. Through procurement, encourage the development, production, and commercialization of new health care technologies.
4. Develop policies that support SME export and scale up.
5. Conduct a full mapping of Canada’s domestic manufacturing capabilities.
6. Strengthen North American manufacturing by leveraging CUSMA.