The Canadian Manufacturers and Exporters (CME) Association released a report in late February, that summarized survey results from Canadian manufacturers and exporters on their perceptions of business conditions.
Key trends from the survey include:
- A majority of manufacturers and exporters expect the value of new orders to fall over the next three months – 56 per cent say that orders are likely to decrease between February and May. This is a less optimistic outlook than in January when only 43 per cent of companies were expecting new orders to drop in the coming three months.
- 45 per cent of companies say that employment levels are likely to fall. This is slightly higher than the 42 per cent of companies that expected their employment levels to fall in the January survey.
- The credit crunch is affecting smaller companies the most, but larger companies are now reporting difficulty accessing financing. 60 per cent of manufacturers and exporters report difficulties accessing adequate levels of financing including obtaining working capital, extending lines of credit, accessing financing for new technologies and product development.
An increasing number of cities in Ontario are significantly above the national average of 7.7% unemployment, including:
- Windor 12.6%
- London 8.4%
- Kitchener 9.1%
- Hamilton 8.4%
- St-Catherines-Niagara 9.5%
- Hamilton 8.4%
- Toronto 8.3%
- Oshawa 8.2%
Ottawa is at 4.6%, but this low number may be misleading due to the outflow of laid-off workers from the city. During past tech layoffs Stats Canada reported that, 2 out of 5 laid off tech workers left Ottawa — with the declining prospects for tech workers in Ottawa, this rate of departures will likely have increased in the current downturn.
A recent Rand report , “The Global Technology Revolution 2020″, looks at 16 upcoming key technologies and the ability of 29 countries to acquire and to implement. The following chart identified the key technology applications -
Only three of the 29 countries examined by Rand were identified as being able to acquire and implement all 16 key technology applications – the United States and Canada in North America and Germany in Western Europe.
Sharp declines in US trade was reported in January 2009. The following chart from http://www.calculatedriskblog.com highlights the sharp downward trend (red is imports and blue is exports) -
Here is a chart showing inbound and outbound container traffic to the port of Los Angeles – it mirrors the decline -
According to the Globe and Mail, Chrysler has resorted to extortion in order to extract tax payer money to prop up their failing company. According to the article:
At a parliamentary committee hearing last night, Chrysler president Thomas LaSorda said the company would commit to maintaining roughly a quarter of its North American production in Canada if its “needs” are met.
Chrysler then went on to list three demands/conditions of Chrysler continuing operations in Canada: union concessions, tax payer money, and an agreement that Canada will back off on its tax collection efforts to recover $1B in taxes it currently owes the Canadian people.
Canada’s Industry Minister Tony Clement has responded today saying that -
(Chrysler officials) “can say whatever they want. … Taxpayers expect us to apply the same rules to everybody in Canada and we’re not going to change the rules for Chrysler”
The 2008 report on Canadian R&D spending from Research Infosource identifies the following top 10 R&D spenders -
|Pratt and Whitney
|Atomic Energy of Canada
Nortel currently accounts for 32% of the R&D spend in the top 10 spenders in Canada, and Magna (automotive parts) currently accounts for 13%. Over 45% of the R&D spend of the top 10 spenders in Canada is in decline and at risk of evaporating to nothing.
Unfortunately – RIM which is always held up as the shining tech light for Canada – isn’t even in the same league as Nortel and never will be. It could be argued that RIM is likely to rapidly diminish in size/scope over the coming years as technologies such as the iPhone and Android continue to see rapid adoption.
Jeff Rubin, CIBC World Market’s chief economist, has published a report that analyzes the automotive industry
Jeff predicts that the US auto industry will undergo a massive correction that will eliminate 200,000 more jobs as half the US’s 51 auto plants are permanently shut down.
Scotiabank Group has also published a report on the auto industry that is not very positive.