Home Month and Year September 2023 Calgary’s Manufacturing Edge

Calgary’s Manufacturing Edge

The sometimes overlooked business sector

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With much of the Calgary business spotlight usually shining on the big business and offshoots of the energy sector, mergers and aAcquisitions, the warp speed trend of start-ups and fluctuations in the real estate market, manufacturing continues as a vital but sometimes upstaged component of business in Calgary.

Despite stale and long-ago discredited cliches and stereotypes, like blue collar vs. white collar and others, Calgary manufacturing matters. “Manufacturing is one of Canada’s key economic drivers,” explains the plugged-in Alan Arcand, chief economist of Canadian Manufacturers & Exporters (CME), the national organization which represents more than 2,500 Canadian manufacturers of all sizes, from coast to coast. “It is the second largest major subsector in Canada, ranking behind only real estate.

“Manufacturing directly generates almost 10 per cent of Canada’s GDP and more than 60 per cent of Canada’s merchandise exports. Including indirect and induced impacts, manufacturing  footprint amounts to one-quarter of Canada’s total economic activity.”

Arcand also points out that manufacturing directly employs 1.7 million Canadians and supports 3.4 million additional Canadian workers through supply chain activity and employee spending.

According to the most recent CME Labour and Skills Survey, some 33,000 people worked in Calgary’s manufacturing sector last year, representing nearly four per cent Calgary’s total employment.

Also in 2022, manufacturing sales in Alberta hit a record high of $108.5 billion, thanks mainly to higher prices, especially for refined petroleum products. The figures track that, in Calgary and Edmonton, factory sales came in at $14.4 billion and $54.9 billion, respectively. “These were also record highs,” he says.

Deborah Yedlin, president and CEO of the Calgary Chamber of Commerce, underscore the importance of manufacturing for Calgary’s success. “Manufacturing is important for the long-term growth of our local economy. Not only does a strong manufacturing industry provide stability and certainty for companies seeking more control over their supply chains, but there is also access to other markets across the country through Calgary’s growing presence as a logistics and distribution hub.

“The importance of a strong manufacturing presence is important to Calgary’s long term economic growth and diversification.”

Calgary’s CGC Inc., the leading Canadian marketer, manufacturer and distributor of gypsum wallboard products, interior finishing materials and suspended acoustical ceilings, is a dynamic example of the importance of manufacturing.

“Canada’s economy and critical industries, such as building and construction, always benefit when products are manufactured close to customers and consumers,” explains Steve Youngblut, CGC’s general manager.

“In our industry, supply chain disruptions have caused delays and uncertainty over the past number of years, making local manufacturing even more important to our economic stability. That’s why CGC is focused on growing our Canadian footprint, including a new, state-of-the art wallboard manufacturing plant in Wheatland County, so we can create our world-leading wallboard closer to customers in Western Canada.

“Like all local manufacturing, the Wheatland plant creates good-paying jobs and spurs innovation, which further supports local and national economies.”

Traditional manufacturing, like machining and a range or products and parts now combine with emerging technology manufacturing to grow Calgary’s manufacturing heft.

Calgary-based Westgen Technologies empowers “the Energy Evolution” and is recognized as a global industry leader in creating the sustainable energy solutions the world needs.

“Manufacturing is very important for the Canadian economy,” says the upbeat Connor O’Shea, Westgen’s CEO. “We have a really important resource industry, and we also have an important manufacturing industry. Manufacturing supports the resource industry, and it is a big part of our economic prosperity in Canada.

“Manufacturing has been gaining importance in Calgary. Traditionally in Alberta and in the western parts of the country, manufacturing tends to be focused on having a fabrication type of a background or skill set. Westgen is focused on building, often customized equipment, primarily for the resource industry.”

Connor Curran is a high-energy and forward-thinking business leader, in a perhaps niche sector of Calgary manufacturing. He is “chief laundry folder” at Local Laundry, the innovative, Calgary-based manufacturer of “Canadian-made garments for social good.”

“Manufacturing is vitally important for the Canadian economy,” Curran emphasizes. “It is a driving force for economic growth, employment, innovation and trade. According to StatsCan, prior to 1979, over 80 per cent of all clothing bought and sold in Canada was made in Canada. By 2020, it was less than six per cent! For every job created in manufacturing, several more are created in other sectors.

“By keeping manufacturing local, we are not only ensuring the creation of quality goods, but we’re also fostering community development, increasing employment rates, supporting a diverse Canadian economy and retaining wealth within our borders.”

Although it is definitely a Calgary dynamic, the manufacturing sector is not without its speedbumps. Like a skilled labour crunch.

The CME’s Arcand emphasizes the urgency and recent slump about manufacturing’s scramble for skilled labour. “Although labour and skills shortages have been a problem in manufacturing for some time, it has recently gotten much worse. In 2021 and 2022, more than 80 per cent of Canadian manufacturers said they faced immediate labour and skills shortages, up sharply from 60 per cent in 2020 and only 39 per cent in 2016.”

CME stats show the top three skilled occupations most in manufacturing demand are: welders, millwrights and machinists.

As CGC’s Steve Youngblut points out, Calgary skilled labour pool was a key consideration for CGC choosing the Wheatland location. “The Calgary region is a rapidly growing market in terms of business and talent attraction, including manufacturing and the skilled workers who drive it. More businesses and more people drive demand for more infrastructure and housing, increasing the need for wallboard and other building and construction materials.

“For CGC, manufacturing in Calgary’s backyard means we can easily supply Calgary area and other western customers with easy, reliable access to our USG Sheetrock® EcoSmart wallboard panels while tapping into Calgary impressive talent pool.”

Local Laundry’s Connor Curran is gung-ho and optimistic about the future of Canadian manufacturing. “There’s growing awareness about the economic and environmental benefits of locally made goods, and it is fostering a resurgence in Canadian manufacturing. Consumers and corporations are more discerning and willing to pay for quality and sustainability. The percentage of clothing being made here is slightly increasing, but, for the first time in a long time, it is not decreasing.”

He adds with positivity about Calgary’s advantages for manufacturing. “Calgary has a skilled workforce, a central geographic location offering easy access to both Canadian coasts and the U.S. market, and a solid infrastructure that supports industrial activities. Moreover, the entrepreneurial spirit encourages innovation and problem-solving in manufacturing processes.”

“We are very bullish and optimistic about the outlook for Canadian manufacturing,” Connor O’Shea notes with enthusiasm. “There are tailwinds and some examples where a lot of manufacturing that had previously been outsourced to countries like China, who is now following the disruptions that the pandemic created in our supply chain. The world is starting to recognize the importance of resiliency and supply chains and a lot of that is achieved through creating capabilities and manufacturing at home.”

The Chamber’s Deborah Yedlin is revved and pumped. “Calgary remains an advantageous place for manufacturing because we have momentum, and we are a competitive jurisdiction with a focus on growing our presence as an inland port for distribution and logistics. By manufacturing locally, we are further spurring economic development within the city.”