Stability on the horizon for some manufacturers, survey reveals
OTTAWA, Ont. – After six months of plummeting orders and job losses, manufacturers and exporters are beginning to see some stability in their business operations, according to survey data from Canadian Manufacturers & Exporters’ April Business Conditions Survey.
"The April numbers reinforce the glimmer of hope that appeared in our
March survey," said CME president, Jayson Myers. "While this is
encouraging, I don’t think we are out of the woods just yet. There are
still many risks ahead for the Canadian economy, including more job
losses, difficulty in obtaining financing and growing protectionism in
our major export market, the U.S."
More than 550 companies participated in the survey conducted in the
first two weeks of April. Exactly 63 percent of firms expect orders to
increase between April and July, up 12 percentage points from March’s
figure of 51 percent. And there’s some good news for job seekers: 13
percent of companies expect to increase employment over the next three
months, which is on par with the March results. The number of firms who
are planning layoffs also shrunk over the past month, decreasing 42 to
"The manufacturing sector has lost 135,000 jobs so far this year, so
this is a ray of hope," said Myers. "The bad news is that while the
number of companies who will be reducing their workforce is down,
one-third are still planning to cut jobs. Current orders have fallen
off significantly the past three months, and many companies are
reporting that inventories are too high."
But the most worrisome element of the survey is an indication the
credit crunch is still an issue for all manufacturers and exporters,
the CME said. Approximately 56 percent of businesses are still
reporting difficulties accessing adequate levels of financing,
including working capital, extending lines of credit and accessing
financing for new technologies and product development. That’s an
improvement of only three percent over March.
"If this is in fact the beginning of a positive trend in the economy,
we are running the risk of that the failure to secure adequate
financing will jeopardize any type of recovery," Myers said.
To view the full report, visit www.cme-mec.ca.