Studies & Reports
2013 Canadian Manufacturing Study: The eighth annual industry survey reflects new optimism on the part of Canada’s manufacturers
By Alison Dunn
Optimistic. That’s how Manufacturing AUTOMATION’s editorial advisory board described the manufacturing industry in Canada back in June, and that same sentiment is reflected in the findings of our eighth annual Canadian Manufacturing Study.
Conducted by Manufacturing AUTOMATION in conjunction with the Excellence in Manufacturing Consortium (EMC), the annual survey is designed to give insight into the Canadian manufacturing sector. While the survey doesn’t drill down into month-to-month comparisons of productivity, demand and more, it does give a snapshot of some of the issues and opportunities awaiting manufacturers in the year ahead.
For the fourth straight year, production has increased for manufacturers overall, which is good news for a sector that struggled during the recession of 2008. And while the increases are, for the most part, less than 10 per cent, it still holds promise that the sector will continue to surge in the next few years.
Companies are also still planning to invest in new equipment and technologies, with more than half planning to increase spending by at least five per cent through 2014.
But with that optimism comes caution. While companies are planning to spend on technology, software and capital equipment, they’re not planning any major purchases, with the majority reporting they will spend less than $199,000 in this area. And while two-thirds of respondents say they are implementing advanced safety technologies, 24.6 per cent say they don’t use them at all.
This year’s study looks at these trends and many more, including a year-to-year comparison of trends dating back to 2006. We’ve also included a number of study highlights, bold charts and graphs, and are sharing some of your own comments on how optimistic you are for the future.
• The average hourly wage for workers is up almost a dollar from 2012 levels, to $21.44 from $20.22. It’s also up more than $2 from 2010’s reported $19.36.
• The amount of workers making more than $25 per hour jumped significantly in 2013, with 29 per cent reporting that wage, compared to only 8.5 per cent in 2012. The number of workers making less than $14 per hour has dropped since 2012, with only 8.7 per cent falling in that range compared to last year’s 20.8 per cent.
• Longevity is the name of the game for Canadian manufacturers, with more than 90 per cent having been in business for at least 10 years, and three-quarters in business for more than 20 years.
• Manufacturers are a little modest, at least when it comes to income. More than half of respondents reported annual revenues below $49 million, about the same number as in 2012.
• When it comes to capital expenditures, it looks like 2014 will be a year for increases of less than 10 per cent, with 37 per cent anticipating spending an extra five to 10 per cent. And 35.2 per cent say they don’t anticipate a change in capital expenditures in the next year.
• Are manufacturers planning expensive purchases in 2014? Some are, but 59.1 per cent are planning to keep the cost of technology, software and related capital equipment and services under $199,000.
• Once again, when it comes to IT, design software (including CAD, CAE and CAM software) is king for Canadian manufacturers. In 2013, 71.9 per cent of respondents say they use design software, up from 69.6 per cent in 2012. ERP software is used by 39.4 per cent of respondents, followed by MRP and financial management systems.
• What’s the most popular plant improvement strategy in Canadian facilities? Once again, Lean tops the leaderboard, with 56.8 per cent of respondents saying they use Lean manufacturing. That number, however, has actually dropped from 63.2 per cent in 2012.
• Continuous improvement is still put to use in Canadian facilities, with 71.6 per cent saying they use this strategic practice. More than half (54.2 per cent) also use quality certifications such as ISO, while 44.8 per cent use a recycling program.
• Material handling tops the list of planned equipment purchases over the next year, with 33.2 per cent planning to buy in this category. Other equipment upgrades planned include assembling equipment, production control equipment and testing/inspection products.
• Safety is on the minds of Canadian manufacturers, as more than two-thirds say they have either already implemented advanced safety technology or have a plan to do so in the very near future. But almost a quarter of respondents don’t use any advanced safety technologies.
• Are Canadian manufacturers planning to expand over the next three years? Certainly in production, with 38.7 per cent saying they plan on expanding this area. That’s down from last year, however, when 39.4 per cent planned production expansions.
• Half of respondents (51.8 per cent) have seen an increase in demand from their customers in 2013, but that’s down a bit from 2012 when 53.4 per cent reported an increase in demand.
• Total production increased for Canadian manufacturers in 2013, with 58.2 per cent reporting increases. But the amount reporting increases greater than 10 per cent dropped significantly, to 11.3 per cent from 17 per cent in 2012.
• The prices of products hasn’t changed for 46.3 per cent of respondents, a slight change from 2012 when 44.8 per cent reported no price change.
• The number of companies expecting layoffs in 2013 is still hovering around the five per cent mark, where it has been since 2011. That’s still an improvement over the 12.7 per cent that expected layoffs in 2009 at the height of the recession.
To see the complete article with graphs, click here.
This article originally appeared in the October 2013 issue of Manufacturing AUTOMATION.