Manufacturing Matters May 7th 2007 St. Catharines City Council: 1 Economic indicators appear to be good… Interest rates are low… Unemployment is sitting at 6.1 percent…a historical low Every month there seems to be good news about jobs… Corporate profits are robust …at least in Oil and Gas But the real story is on the local job front… 2 Ontario lost 171,600 (15%) manufacturing jobs: Niagara area has lost 15% of its manufacturing jobs St. Catharines has suffered as much as anyone. 3 2007, Announced Six Plant Closures Employers Town Jobs Canada Hair Cloth St Catharines 42 Cadbury Schweppes St Catharines 26 Dana Canada Frame Thorold 125 Niagara Brewing Niagara Falls 11 Haun Drop Forge Welland 29 Dana Canada Thorold 537 4 2006, Three Niagara Plant Closures Employers Town Jobs Port Weller St Catharines 250 Newville Candies Niagara Falls 60 Affinia St Catharines 250 5 2005, Six Niagara Plant Closures Employers Town Jobs Beamsville 70 ConAgra Niagara Falls 224 Stelpipe Welland 400 Bazaar & Novelty St. Catharines 200 Ferranti Packard St Catharines 275 Alcom Port Colborne 70 Maax Spas 6 2004, Two Niagara Closures Employers GM American Axle Maax Spas Town Jobs St. Catharines 750 Beamsville 70 7 2003, Seven Niagara Plant Closures Employers Town Jobs Saint Gobain St. Catharines 35 Atlas Specialty Steels Welland 630 Atlas Steel 10-1 mill Welland 200 Washington Mills, (Exolon) Thorold 25 Ronal Canada Stevensville 160 Welland Pipe Welland 177 GM - Delphi St Catharines 400 Fleet Industries Fort Eire 350 8 2002, Six Niagara Plant Closures Employers Town Jobs Domtar St.Catharines 210 American Axle St. Catharines 340 Cunningham Foundry St. Catharines 70 Zippo Manufacturing Niagara Falls 22 Swagelok Canada Niagara Falls 88 General Drop Forge Welland 85 9 2001, Six Closures Employers Town Jobs Taylor & Bate St. Catharines 7 Fantom Technology Welland 365 Irvine Industries Fort Erie 150 E.S.Fox Kent Ave. Niagara Falls 60 GYRO Industries Niagara Falls 60 Gallaher* (2000) Thorold 310 10 Niagara Region Hit Hard Since 2000, 35 plant closures, a loss of 5,952 manufacturing jobs in Niagara. Some of these plants have been around since the 1920’s These statistics do not take into account, downsizing that has taken place in manufacturing facilities! General Motors Atlas steel 9,000 2,400 2,800 Dana 3,000 200 0 11 Canada's Manufacturing Sector In the last 4 1/2 years Canada has lost about 250,000 manufacturing jobs. In 2 years, the job loss rate has actually accelerated. More than 150 jobs are lost every single day. In the time it takes to do this presentation, 2 manufacturing jobs will disappear 12 Condition is Chronic Manufacturing share of jobs in the economy down 25% in 10 years Not in a recession: Early 80’ and early 90’s Period of economic growth Not isolated to one sector, one region, or one period of time. 13 Other Regions: Other Cities Nova Scotia Lost 20% Quebec Lost 18% Windsor Lost 25% Toronto Lost 21% Oshawa Lost 21% Thunder Bay Lost 20% St Catharines Lost 26% Toronto lost 104,600 jobs St Catharines lost 2, 855 14 The problem is widespread. Across manufacturing industries... Sector Textiles and Clothing Jobs Lost % 66,000 -40% Aerospace 8,300 -16% Shipbuilding 3,300 -32% Food and Beverage 40,000 -13% Primary Metal 12,500 -13% 8,500 -9% 10,700 10,000 -8% -7% Paper Wood products Automotive 15 Manufacturing is on The Critical List 17% 16% Manufacturing Share of Total Employment (Canada) Jan '87 - Dec '06 2002 Start 16.7% of CDN of recent Workforce Loss of 4.2% decline 15% 14% 13% 12.5% of CDN Workforce 12% 11% 10% Jan 1987 Oct 1988 Jul 1990 Apr 1992 Jan 1994 Oct 1995 Jul 1997 Apr 1999 Jan 2001 Oct 2002 Jul 2004 Apr 2006 16 Trends bounce back… Manufacturing is in a Free Fall Manufacturing Share of Total Employment (Canada) - August 2002-January 2007 15.00% 14.00% 13.00% 12.00% 11.00% Aug 2002 Dec 2002 Dec 2003 Dec 2004 Dec 2005 Dec 2006 Jan 2007 17 Unbalanced Trade is a major problem Large and growing manufacturing trade deficit From a surplus of $12 billion to a deficit of $29 billion in a decade. Deficit grew by 75% during 2006, highest on record. Trade exports have shifted to resources 2005 was the first time that mineral fuel products (oil and gas) passed transport vehicles as our top export. Losing ground on all accounts Low-tech, resource-based manufacturing, and higher value-added 18 Manufacturing - Niagara's Economic Engine Accounts for: 18.4% of local economy 25,600 workers Auto is critical Almost 1 in 4 are auto workers Manufacturing is Diverse 4,900 Metal Workers 3,800 Food & Beverage workers Petrochemical, Paper and many others 19 Loss of manufacturing jobs affects everyone Manufacturing workers earn and spend close to $1.5 billion a year. Supports regional economy Supports infrastructure Local tax base (property taxes) Major contribution to income tax Support local business But it used to be more 4,400 lost jobs is an impact of over 239 in lost wages every year. million dollars 20 Ripple effect… A crisis that affects everyone All the spin-offs tourism, food and retail, social programs, charities Chronic Insecurity Even those who have jobs are constantly threatened 21 Manufacturing Matters Manufacturing is a vital source of jobs: 2.1 million Canadians, or 1 in 8 jobs 1 in 6 jobs in Ontario 1 in 7 in Niagara 22 Benefits Spread Far and Wide Canada’s Manufacturing Sector: Directly accounts for 17% of economic activity Purchase of goods & services, and spin-offs, total up to 55% of economic activity. Creates $3.05 elsewhere for every $1 activity. 23 If Manufacturing Isn’t The Future? Has highest value-added sector Accounts for two-thirds of nation’s exports Accounts for 75% of private sector R&D 24 These Are Good Paying Jobs Family-supporting Pay: Hourly pay in Ontario: $21.33 With overtime, $50,900 per year 24% higher than average for all Ontario Replacement jobs pay 25% less Opportunities for our youth: We need core industries Engineers, Trades, Apprenticeships, Management, as well as line workers 25 Support For Our Communities Canada’s manufacturing workers: Direct payroll of $94 billion per year Generate income taxes of $20 billion per year Health Care Education Infrastructure Social Services Add to this: sales, property and other taxes. If you care about our social programs, you have to care about manufacturing. 26 Niagara Information Meeting Rick Alakas Wayne Gates 27 David Robertson Tim Lambert What we want to do… Demonstrate that the Manufacturing sector is key to the future of Canada Draw attention to the impact job losses is having on communities like St Catharines. Point out that the crisis…is being ignored Call for a report & debate on the manufacturing crisis Our draft resolution asks for … 28 Draft Resolution... Identifying the manufacturing industry as a strategic sector in Canada’s economic development; 29 Draft Resolution... Undertaking a comprehensive review of the causes and consequences of manufacturing job loss; 30 Draft Resolution... Adopting a comprehensive and integrated set of economic, fiscal and monetary policies along with a framework for fair trade that will both strengthen domestic manufacturing and protect manufacturing jobs; and 31 Draft Resolution... Ensuring that all Canadian workers are protected in job loss through the improvements of bankruptcy laws, wage protection, pension protection and enhanced employment insurance benefits. 32