Canadian Industries Suffering

OTTAWA – In the latest Canadian Industrial Profile from the Conference Board of Canada, the agency is forecasting that profits will be down more than 20 per cent across six of Canada’s major industries.

The 2009 report offers a five-year outlook for some of the country’s largest industries for employment and revenue generation, including foodservices, accommodation as well as food and beverage manufacturing. “All industries are grappling with the effects of reduced demand and downward pressure on prices as a result of the recession. The end result is reduced sales and profitability in nearly every industry covered in these reports,” said Michael Burt, associate director, Industrial Economic Trends. “On the upside, the recession has lowered input prices and limited wage growth, reducing cost pressures.”

In the foodservice sector, restaurants providing cheaper alternatives to diners have performed OK during the recession, with full-service and especially upscale eateries seeing sharp declines. After a $1.2-billion profit in 2008, the foodservice industry should see a 32 per cent reduction in 2009, with profit levels of $826 million for the year.

In the accommodation industry, after a 25 per cent decline in profits last year, industry profits are expected to see another eight per cent drop in 2009, to just below $500 million. Interestingly, the food and beverage manufacturing sector held steady, with demand levels maintaining integrity and exports to new markets growing in spite of the strong loonie. Profits are expected to rise to $3.4 billion in 2009.

There is still some good news from the analysis, which showed that the recession has a small silver lining — it’s forced all industries to reassess the way they do business and seek better and more efficient alternatives.

The publication is available here.