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Town of Okotoks Manufacturing Sector Analysis November 2018

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Town of Okotoks Manufacturing Sector Analysis November 2018 Town of Okotoks Manufacturing Sector Analysis November 2018 Table of Contents 1. Sector Overview............................................................................................................. 1 1.1 Sector Size & Performance ..................................................................................................... 1 1.2 Workforce & Employment ...................................................................................................... 2 1.2.1 Employment Data & Projections ..................................................................................................... 2 1.2.2 Occupational Data & Projections ..................................................................................................... 5 1.2.3 Wages/Salary Data .......................................................................................................................... 8 1.2.4 Education and Training.................................................................................................................. 10 1.3 Local Industry ....................................................................................................................... 10 1.3.1 Business Establishment Counts ..................................................................................................... 10 1.3.2 Business Establishment Location Quotients .................................................................................. 12 1.3.3 Financial Profile of Businesses ....................................................................................................... 13 1.3.4 Major Employers ........................................................................................................................... 14 1.4 Trade (Exports & Imports) .................................................................................................... 15 1.5 Sector Trends & Outlook ...................................................................................................... 15 1.5.1 Manufacturing Trends ................................................................................................................... 15 1.5.2 Alberta Manufacturing Outlook .................................................................................................... 16 1.5.3 Canada Manufacturing Outlook .................................................................................................... 16 2. The Okotoks Advantage ............................................................................................... 18 2.1 Core Clusters ........................................................................................................................ 18 2.2 Local & Regional Assets ........................................................................................................ 19 2.2.1 Post-Secondary Institutions ........................................................................................................... 19 2.2.2 Research Areas & Facilities ............................................................................................................ 19 2.2.3 Major Land & Infrastructure .......................................................................................................... 20 2.3 Market Position & Competitiveness ..................................................................................... 20 2.3.1 Strengths & Opportunities ............................................................................................................ 20 2.3.2 Weaknesses .................................................................................................................................. 21 3. Appendix (Definitions) ................................................................................................. 22 Okotoks: Manufacturing Sector Analysis Page i 1. Sector Overview The manufacturing sector comprises establishments primarily engaged in the chemical, mechanical or physical transformation of materials or substances into new products. These products may be finished, in the sense that they are ready to be used or consumed, or semi-finished, in the sense of becoming raw material for an establishment to use in further manufacturing. Under Statistics Canada and the North American Industry Coding System (NAICS), this consists of 21 different sub-sectors. 1.1 Sector Size & Performance Canada’s manufacturing sector contributed $1.8 trillion to Canada’s overall GDP in 2017. According to Statistics Canada, Alberta is the third largest output contributor to total manufacturing GDP in Canada, with a contribution of more than $17.7 billion in 2017. Figure 1: Gross Domestic Product for Manufacturing Sector by Province 2017 ($CAD Billions) 90.0 $82.2 80.0 70.0 60.0 50.0 $46.1 40.0 30.0 $17.7 20.0 $16.8 10.0 $5.5 $4.4 $3.0 $2.6 $1.0 $0.5 0.0 ON QC AB BC MB SK NB NS NL PEI Source: Statistics Canada GDP by NAICS at Basic Prices, Table 379-0030, 2018 Due to Alberta’s manufacturing sector being primarily driven by the needs of the oil and gas industry, the growth or decline of manufacturing output typically follows the performance of the energy sector. In 2015 Alberta experienced an economic downturn due to a global drop in oil prices, impacting the province’s industries across the board. The manufacturing sector saw contraction in output for 2015 and 2016, however as energy recovered as did manufacturing with a growth in output for 2017. Overall, the compound annual growth rate from 2007-2017 has been -0.4 percent. Figure 2: Manufacturing Sector GDP Output and Year-Over-Year Growth for Alberta (Billions CAD) 2013 2014 2015 2016 2017 Manufacturing GDP $18.3 $18.8 $17.6 $16.3 $17.7 Y-O-Y Growth (%) 3.0% 2.9% -6.6% -7.1% 8.6% Source: Statistics Canada GDP by NAICS at Basic Prices, Table 379-0030, 2018 Okotoks: Manufacturing Sector Analysis Page 1 1.2 Workforce & Employment 1.2.1 Employment Data & Projections The Province of Alberta is the fourth largest employer in the manufacturing sector, employing approximately 7.7 per cent of the total manufacturing sector workforce in Canada. When analyzing these numbers in terms of overall employment in each province, approximately 5.6 per cent of Alberta’s employed workforce is in manufacturing – the second lowest percentage of all the provinces, after Saskatchewan. Quebec employs approximately 11.0 per cent of their workforce in manufacturing – the highest percentage of all the provinces – followed by Ontario (9.8%) and New Brunswick (8.5%). Figure 3: Employed Labour Force in Manufacturing Sector, Provinces, 2016 (Number of People) 700,000 651,835 600,000 500,000 436,045 400,000 300,000 200,000 149,455 116,760 100,000 52,450 29,160 28,715 25,070 13,010 5,725 0 ON QC BC AB MB NS NB SK NL PEI Source: Statistics Canada, Census, 2016 As of the 2016 Census, approximately 785 residents of Okotoks are employed in the manufacturing sector, however the majority of these workers are employed in Calgary and other areas surrounding Okotoks. The most common manufacturing sub-sectors for Okotoks residents working in manufacturing include, food manufacturing (190 workers, 24.2%); fabricated metal products manufacturing (100, 12.7%); and machinery manufacturing (85 workers, 10.8%). See Figure 4 for a detailed breakdown. When analyzed by place of work, Okotoks has an estimated 160 workers who are employed in manufacturing locally, according to the 2016 Census. Okotoks: Manufacturing Sector Analysis Page 2 Figure 4: Employed Labour Force in Manufacturing Sector, Communities, 2016 (Number of People) Industry (NAICS) Okotoks Calgary CMA Alberta NAICS 311: Food 190 5395 18340 NAICS 312: Beverage and Tobacco Product 25 1215 2525 NAICS 313: Textile Mills 0 120 270 NAICS 314: Textile Product Mills 0 215 600 NAICS 315: Clothing 0 345 900 NAICS 316: Leather and Allied Product 0 25 130 NAICS 321: Wood Product 40 1555 8045 NAICS 322: Paper 10 725 2915 NAICS 323: Printing and Related Support Activities 30 1950 4175 NAICS 324: Petroleum and Coal Products 50 2320 7785 NAICS 325: Chemicals 70 2100 8520 NAICS 326: Plastics and Rubber Products 30 1550 5245 NAICS 327: Non-Metallic Mineral Product 35 2355 6055 NAICS 331: Primary Metal 15 935 3600 NAICS 332: Fabricated Metal Product 100 4490 17155 NAICS 333: Machinery 85 3795 11215 NAICS 334: Computer and Electronic Product 35 2280 3855 NAICS 335: Electrical Equipment, Appliance, and Component 0 1015 2040 NAICS 336: Transportation Equipment 25 1175 3435 NAICS 337: Furniture and Related Product 20 2450 4655 NAICS 339: Miscellaneous 25 1930 5305 Manufacturing Employed Workforce 785 740235 116765 Percentage of Total Employed Workforce 5.4% 5.1% 5.6% Source: Statistics Canada, Census, 2016 Figure 5 showcases the location quotients (LQ)1 for Okotoks in 2016. The LQs measure the concentration of manufacturing employment in Okotoks relative to the Calgary CMA and Alberta. When compared to the Calgary CMA, Okotoks has a high concentration of their labour force working in food, wood product, and chemical manufacturing. When compared to the Alberta, Okotoks has a high concentration of their labour force working in food, beverage, and computer and electronic products manufacturing. On average, Okotoks has an average concentration of its employed labour force working in manufacturing when compared to the Calgary CMA and a low concentration when compared to Alberta as a whole. 1 An LQ of 1.25 and over suggests a high concentration of local activity in an industry and a LQ of less than 0.75 suggests a low concentration of local activity
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