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May a month of new records, challenges for Saskatchewan manufacturers

Published by CME Staff on July 17, 2014

For the second straight month, Saskatchewan manufacturing sales climbed to a new record high in May, peaking at nearly $1.5 billion. But, according to the association representing manufacturers in the province, shifting pressures in both domestic and global markets, coupled with ongoing productivity and workforce challenges, are adding caution to an otherwise optimistic outlook for the remainder of the year. 

Officials with Canadian Manufacturers & Exporters (CME) and the CME-led Saskatchewan Manufacturing Council (SMC) say that, while May figures were up 2.4 per cent on the month and 4.8 per cent year-over-year, trends in output and in strategic sub-sectors of Saskatchewan's value chain are key reasons to remain vigilant. 

"It's no secret that the first five months of 2014 have been exceptionally strong for Saskatchewan's manufacturing sector as a collective," explains CME Vice President & SMC Executive Director, Derek Lothian. "In fact, in that timeframe, the industry has expanded more than nine per cent from 2013. Business conditions however are ever-changing, and whether it's due to dampened demand for products in the resources sector or a widening gap in our regional skills availability, we need to make sure the supports are there to allow manufacturers to be agile, invest and grow." 

Lothian notes that, since January, machinery sales have dropped by nearly five per cent; and, although fabricated metal has rebounded seven per cent so far on the year, it is still off pace to recoup the double-digit loss suffered in 2013. 

Certain areas of the province, meanwhile, continue to battle significant skills and labour shortages as well. Compared to pre-recession levels (2007), the sales-per-employee of Saskatchewan manufacturers have increased by more than 78 per cent. Lothian points to such projects as the new Saskatchewan Manufacturing Centre of Excellence, expected to launch later this year with the support of the provincial government, as vital to lessening the strain.

"We're fortunate that the challenges in front of us are definitely ones we can overcome," he says. "To do that, though, we must do what Saskatchewan does best — work together. We have a world-class manufacturing sector in this province that rivals the level of innovation and quality of any on the planet; but our challenges are unique, and so, too, must be our approach to solutions."

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