Canada falling behind global competitors

Despite low unemployment, the high value of the dollar, and a strong resource sector, Canada is becoming less competitive and unless the situation is addressed Canada’s future economic prosperity is at risk, according to a recent report from the Conference Board of Canada.

“We are becoming less competitive. In just two years, we have slipped from 3rd to 12th place in comparative measurements of macroeconomic and microeconomic performance,” the report entitled, Mission Possible Executive Summary: Sustainable Prosperity for Canada states. “Canada lags behind most developed economies in productivity growth. Our resource sectors require significant new strategic investment if they are to meet global competition, and our biggest cities are starved for investment in comparison with global cities elsewhere. In vital sectors of our economy, we are not keeping up with our competitors.”

The Mission Possible Executive Summary report is the fourth volume of a set of four volumes comprising the final Canada Project report. The three previous reports included: Mission Possible: Stellar Canadian Performance in the Global Economy; Mission Possible: A Canadian Resources Strategy for the Boom and Beyond; and Mission Possible: Successful Canadian Cities.

The Canada Project, which was launched by the Conference Board of Canada in 2003, was designed as a three-year program of research and dialogue aimed at helping decision-makers plan a policy course that improves Canada’s standard of living and competitive position in North America and globally. Forty-five companies and organizations invested in the project providing financial, leadership, and knowledge support.

According to the report, despite our historically strong position in the North American market, Canada is not insulated from the continuing impact of globalization.

“Growth in our exports to the United States has slowed in recent years, and the growth that has occurred was largely due to the energy and other resource sectors. The growth in exports that are unrelated to energy-in the automotive sector and in manufacturing-has been weak.

“North American economic integration is slowing, and, in a much more anxious security environment, the United States is thickening its borders. The North American Free Trade Agreement (NAFTA) has lost its dynamism, its momenturm, and, in part, its legitimacy, at least for the moment,” the report points out.

As a result, the Conference Board says that Canadian investors are looking increasingly to other dynamic markets such as Europe, Latin America, and Asia.

However, the report notes that improving productivity is only one aspect of the issue. “The future demands not only an improvement in productivity, but a productivity that is sustainable. Across the board, Canada must invest in development that meets the needs of the present without compromising the ability of future generations to meet their needs,” the report warns.

The report recommends seven key strategies aimed at building a sustainable prosperity in Canada. The strategies include: putting in place a comprehensive national strategy to increase Canada’s lagging productivity; creating an integrated national market; investing in and supporting a workforce that is equipped to meet the challenges of the global economy; adopting strategic investment and trade policies; sharpening our foreign policy priorities; investing in our resource industries so that they are competitive and sustainable; and investing strategically in our major cities so they can fulfill their potential as engines of sustainable national growth.

“Common to all seven strategies is the imperative to increase productivity in sustainable ways, the necessity to develop knowledgeable and skilled workers and managers, the importance of redesigning our fiscal and regulatory architecture, and the urgency of special treatment for our major cities,” the report says.

For example, looking at the issue of productivity, the report notes that compared to the U.S. economy, only one-fifth of the Canadian economy is more productive with the remainder being less productive.

“We need to open industries to competitive pressures, we need to improve the level and quality of capital intensity, we need to encourage organizational and managerial innovation, and we need to reform our tax system to encourage lower-income Canadians to stay enaged in the labour market,” the report says.

The report continues, “Without serious attention to economic and environmental sustainability, Canada puts its society and its quality of life at risk. Sustainability matters. It must become one of the yardsticks against which we measure productivity.”

Obviously, if we expect to successfully compete in the global market and maintain our quality of life in the future, the time to act is now.

Jerry Cook
Editor, MPP
jcook@clbmedia.ca

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Ontario will benefit from expanded programs, services

Sandie Birkhead-Kirk, director of apprenticeship with Ontario's Ministry of Training, Colleges and Universities, congratulates Justin Cutting of Kodiak Tool & Die Co. Ltd. who was the winner of the Canadian Tooling and Machining Association's 14th Annual Apprenticeship Competition. The awards were presented at the association's recent annual general meeting.

Transferring many federal training and employment programs, resources, and staff to Ontario will result in a number of new opportunities for apprenticeship and skills training in the province, says Sandie Birkhead-Kirk, director of apprenticeship with Ontario’s Ministry of Training, Colleges and Universities.

Under the Canada-Ontario Labour Market Development Agreement, which came into effect earlier this year, some $525 million in programs were transferred from the federal government to Employment Ontario.

“January 1, 2007 was a big day for training in Ontario because we took in the federal programming which involved about 500 staff and brought us up to approximately one billion dollars in training in the province of Ontario. It also means that we now have 1,200 points of service and about 900,000 clients. Right now there are approximately 97,000 active apprentices in Ontario and there are about 33,000 employers. At the same time, about 39,000 apprentices went to school last year, ” Birkhead-Kirk told the recent annual general meeting of the Canadian Tooling and Machining Association (CTMA).

The transfer of federal programming to the province offers a number of advantages for Ontarians with respect to apprenticeship and skills training, she says. “We’re still in the growing stages because the logistics alone (of this change) has been huge as well as taking two groups of people from across the province and melding them together. We are still in these transition stages but the possibilities that this offers is very exciting for us in being able to offer programs and services across the province in a consistent and quality way.

“For example, we’ve created a strong, regional presence. Previously, I used to be the only director but now there are five directors in our division. It will also allow us to put decision-making and planning closer to the community so that all of the decisions won’t be made centrally and will be much more influenced by local planning,” she says.

According to Birkhead-Kirk, transferring the federal programs to Ontario will also enable the province to offer expanded training and employment services. “With the integration of apprenticeship into the broader skills training and post secondary system, it means that we can now look at more ways to ladder apprenticeship training.

“For instance, what if you want to go beyond apprenticeship into some other post secondary training? What if you want to take that apprenticeship training and build on it at a college or university? There will be opportunities to do that now,” she says.

Another highlight of the CTMA’s annual general meeting was the presentation of the awards to the winners of the association’s 14th Annual Apprenticeship Competition. Birkhead-Kirk presented the awards to the winning apprentices.

Interactive Town Hall at Canadian Manufacturing Technology Show

While attending this year’s Canadian Manufacturing Technology Show at Toronto’s Direct Energy Centre, be sure to include in your schedule the Interactive Town Hall on Tuesday, October 16 from 9 to 11 a.m. and join this important discussion where you can learn and ask questions of Canada's manufacturing leaders.

On the panel will be: Jayson Myers, President, Canadian Manufacturers and Exporters; Brian Holmes, 2007 President, SME and VP Operations, Columbia Plastics; Tom Vandeloo, Advisory Partner, Operations and Improvement, KPMG; and Paul Hogendoorn, President, OES Inc. and past chair of the London Region Manufacturing Council. The event will be moderated by John Tenpenny, editor of Advanced Manufacturing and Jerry Cook, editor of Metalworking Production & Purchasing.

The topic under discussion will be innovation.

It is generally accepted that innovation is a major driver that keeps Canadian manufacturers competitive and the panel discussion will be focused on the importance of innovation in your company. You will be able to hear from and ask questions about issues such as:

• Creating and sustaining an innovative business culture;
• Best practices for bringing innovations to market;
• How to decide which processes or product innovation to pursue;
• Financing and measuring the success of your innovation spending; and
• The roles of customers and suppliers in sparking innovations.

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September 2007 issue
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