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AB manufacturing sector hits record sales using fewer workers

Alberta’s manufacturing sector is making $1.7B more than they were 6 years ago but using tens of thousands of fewer workers to do it.

Siddhartha Bhattacharya, an economist with ATB Financial, published an article yesterday reporting that manufacturing sales in Alberta hits an all-time high in November 2021.

This article was then tweeted out by Bhattacharya’s colleague Rob Roach, ATB’s deputy chief economist.

And that tweet was retweeted by Doug Schweitzer, Alberta’s minister of jobs, economy, and innovation.

According to the article, Statistics Canada data shows that manufacturing sales “jumped by $307 million (+4%) to reach $7.6 billion, the highest level on record”, which goes back to 1992.

It goes on to say that nearly half of the manufacturing sub-sectors saw increases, “with refined petroleum products (+10%) driving over half the total monthly increase”. Food manufacturing came in second place at 3%.

Here are the manufacturing subsectors that saw increases in November, listed in order of percent increase, according to the Statistics Canada data.

Textile product mills22.77%
Fabricated metal product12.03%
Plastics and rubber products11.54%
Paper11.26%
Petroleum and coal product10.42%
Non-metallic mineral product10.33%
Electrical equipment, appliance and component9.74%
Transportation equipment7.58%
Furniture and related product6.88%
Wood product4.63%
Food2.89%

And here they are listed in order of increases in actual sales value:

Petroleum and coal product$177.2 million
Food$51.8 million
Fabricated metal product$49.4 million
Wood product$23.1 million
Paper$22.4 million
Plastics and rubber products$20.4 million
Non-metallic mineral product$17.6 million
Transportation equipment$4.0 million
Furniture and related product$3.6 million
Electrical equipment, appliance and component$3.5 million
Textile product mills$0.6 million
Total$373.7 million

Here are the subsectors that saw decreases over October 2021, in order of the size of their decrease.

Machinery-6.64%
Primary metal-6.29%
Computer and electronic product-4.93%
Printing and related support activities-4.52%
Beverage and tobacco product-4.40%
Chemical-1.17%
Miscellaneous-0.47%

And finally, the decreases in actual sales dollars

Machinery manufacturing-$31.8 million
Chemical manufacturing-$15.1 million
Primary metal manufacturing-$7.4 million
Beverage and tobacco product manufacturing-$4.5 million
Computer and electronic product manufacturing-$3.7 million
Printing and related support activities-$2.9 million
Miscellaneous manufacturing-$0.4 million
Total-$65.7 million

And while it might seem like good news that the manufacturing industry is making more money overall, there is another stat we should keep in mind and that Bhattacharya left out of his article.

Jobs.

In his article, Bhattacharya included a chart that displayed manufacturing sales since November 2010.

Notice how the total sales has been trending upwards over the last 11 years, notwithstanding drops during the 2015–16 recession and the pandemic?

Now look at manufacturing jobs during the same period.

Here we see a completely different scenario.

During the first 3 years, manufacturing jobs seemed to trend upwards, mirroring ATB’s chart for manufacturing sales. Likewise, both sales and jobs dropped during the 2015–2016 recession, then started to rebound.

However, we notice that in early 2019, just before the provincial election, manufacturing sales hit a record high. Manufacturing jobs, on the other hand, hadn’t.

In December 2018, despite trending up a year and a half, there were still roughly 13,000 fewer manufacturing jobs than there were at the peak during the start of 2015.

And those jobs remained there—more or less—for the next year or so, before the pandemic hit, and the province lost about 20,000 manufacturing jobs. Since then, manufacturing jobs have been on a bit of a roller coaster, with short jumps, each time followed by brief drops.

In November 2021, there were 118,200 manufacturing jobs in Alberta. That’s only 500 more jobs than there were in April 2020, the lowest point of the pandemic, despite a year and a half transpiring since that bottoming out.

That 118,200 mark is still about 20,000 fewer than there were in February 2020, which was just before the pandemic health restrictions were first implemented and the highest point manufacturing jobs had reached since the summer of 2015. It’s also over 30,000 fewer than the peak since in January 2015.

So, let’s recap. There were more than 30,000 fewer manufacturing jobs this past November than there were in January 2015. On the other hand, manufacturing sales were $1.66 billion higher in November 2021 than they were in January 2015.

So, if the sector is making $1.66 billion more than they were nearly 6 years before but doing it with 30,000 fewer workers, where is all that additional money going?

And the fact that Alberta’s jobs minister is boosting information on Twitter that doesn’t appear to favour workers should tell you something about how the UCP actually feel about jobs.

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By Kim Siever

Kim Siever is an independent journalist based in Lethbridge, Alberta. He writes daily news stories, focusing on municipal, provincial, and federal politics, specializing in investigative journalism and critical analysis from a leftist political lens. He also writes regular editorials on general politics and social issues.

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