Why should we care if manufacturing exists in Canada? Why should we care if everything we buy is made an ocean away?
I’ll give you 3 reasons:
- Our national prosperity and security.
- The environment.
- A future to look forward to.
For most of the 20th century, Canada had a strong manufacturing tradition – particularly in Ontario. But it has been on a downward slide for quite some time. We’ve lost over half a million manufacturing jobs in the last 6 years alone. Manufacturing jobs that supported a good standard of living – at all levels in our economy, provided a strong tax base for our government, gave us a measure of independence and helped the middle class thrive.
Why hasn’t anyone been screaming about this?
They have been. But for years no one has been listening. Even the governments in Ontario have, at times, acted like the decline in manufacturing was unimportant – the inevitable progression of a mature economy. All levels of government and much of the public had bought into the idea that we could prosper with a service and resourced-based economy. This was compounded by the adoption of a globalization model that allowed offshore emerging economies to grow their own economies and support us with low cost imports.
I’ll give you two reasons why this will not work.
First, relying on our resources makes us entirely dependent on the need in other countries and only gives us a small slice of the prosperity pie. Of the wealth generated during the production of goods, a relatively small portion goes to the suppliers of the raw materials. We need to sell a huge volume of oil and gas and trees and minerals to balance out the cost of the goods we buy in return. But even with oil hovering around $100 a barrel, we are not in balance – our trade deficit is proof of that. The less we manufacture and the more we buy finished goods from other countries, the more we go out of balance and impoverish ourselves.
The service based economy, on the other hand, does not generate wealth. We won’t prosper washing each other’s laundry. At best the service industry provides some things that make life a little nicer to live. At worst, it moves around money without real purpose other than to make a few people rich and puts the global economy at risk. But if you can’t afford those nice-to-have services because your service-based job doesn’t pay well enough, you probably aren’t benefitting from this type of economy much at all.
So let’s take it back. Let’s Take Back Manufacturing.
The Take Back Manufacturing (TBM) initiative was started in 2011 and continues to be spearheaded by the Toronto Chapter of the Society of Manufacturing Engineers (SME). However, it is not an SME initiative. It is a nonpartisan effort to gather all like-minded organizations and leaders who believe manufacturing is important and get them to work together to bring this issue to the forefront – to speak and act collectively with one goal in mind: strong manufacturing in Ontario AGAIN.
It won’t be an easy road and there will be different roles for each of us to play, but it is achievable. This is the TBM roadmap:
- Combat the public relations nightmare that manufacturing has. Unfortunately the view that manufacturing is dark, dirty, difficult and dangerous has been allowed to propagate. As a society we’ve told our children to find some other “better” way to make their living – that must change. Anyone who believes that manufacturing hasn’t changed since the early to mid-twentieth century industrial era hasn’t seen a modern manufacturing facility. Manufacturing has become high-tech, cleaner than many people’s houses and safer than driving.
- Make the right policy decisions. Governments need to understand that having a strong manufacturing base in our economy isn’t an option if we want to enjoy a high national (vs. regional) level of prosperity and remain leaders on the global stage. We need government to set policies that will support manufacturing – policies on tax, trade and education. We need to recognize that even innovation, which has been stated as one of the requirements for our future success, requires a strong manufacturing infrastructure to act as an incubator. Finally, we all need to get over the idea that trade at any cost is a good thing and understand that what we really need is fair-trade.
- Make good, long-term business decisions. It’s about balanced sourcing – it’s not about bringing back all manufacturing because we want to. Some things will never come back – it just doesn’t make sense. But as we better understand all the costs of extended, complex supply chains, of lower workmanship, worker health, safety and environmental standards, the rising price of oil, inflation in emerging economies, artificially low interest rates and the total cost of giving away our intellectual property and know-how for free, we will realize that it makes sense to have manufacturing for a range of commodities here at home.
- Get ready. Manufacturing won’t come back just because it’s our lucky day and the economic incentives that drove us to offshore are waning. We need to take manufacturing back and everyone must do their part. Industry leaders need to make sure their plants are properly capitalized, their workforce is properly trained and their total business processes are lean and efficient. Educational leaders and industry leaders need to work more closely together to produce new generations of manufacturing experts who can hit the ground running when they enter the workforce.
By getting involved and working together, we can put the heyday of automatic off-shoring and wealth transfer behind us and help create a future for Canada that doesn’t look more bleak than its past. For more information on the Take Back Manufacturing initiative or to get involved, please visit the TBM website at www.sme-tbm.org. For more information on SME Toronto, please visit www.smetoronto.ca. For more information on SME, please visit www.sme.org.
About Marie Laird
Marie Laird is a Supply Chain Professional working in the biotechnology sector at Luminex Molecular Diagnostics. As Logistics Manager she is responsible for process improvement, procurement, production planning, inventory control, international distribution and other logistical matters for the Toronto operations. Previously Marie worked for Coca-Cola Ltd.
Marie has been a member of SME since 2009 and during that time has been Chair of the Toronto Chapter as well as a co-founder of the Take Back Manufacturing movement that SME Toronto spearheaded in 2011 and continues to lead today.