Evidence of meeting #4 for Industry, Science and Technology in the 39th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was sector.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

  • Tom Wright  Assistant Deputy Minister, Industry Sector, Department of Industry
  • Colleen Barnes  Acting Director, Financial Institutions, Financial Sector Policy Branch, Department of Finance
  • Janet King  Director General, Service Industries and Consumer Products Branch, Department of Industry

9:55 a.m.

NDP

Peggy Nash Parkdale—High Park, ON

The question I would ask you, then, is do you not think it is of concern to Canadians, and to us as parliamentarians on this committee and in the House of Commons, that we are losing manufacturing jobs and the security of those jobs, and that the growth in employment is in the parts of the service sector that are relatively less secure and low-paid?

9:55 a.m.

Assistant Deputy Minister, Industry Sector, Department of Industry

Tom Wright

There will be a dimension of that, and yes, I think the committee wants to be aware of that. But I think one also has to have the context of the overall employment levels. One also has to take a look at the balance of growth elsewhere within the service sector.

If your initial starting point is manufacturing, I think you have to go back and consider and understand manufacturing in all of its various aspects. Again, that will bring you back to the services sector, and comparative advantage, in more and more of these companies, coming from a high level of productivity--of technology, the engineering--of a number of those services at the higher end of the wage scale.

I think there is growth in some of those areas as well, albeit not as high a rate of growth. But I think there's opportunity, and that's where we want to grow. So the opportunity for the future is to see how we can move into some of those areas.

9:55 a.m.

Conservative

The Chair James Rajotte

Thank you.

Thank you, Ms. Nash.

We'll go to Mr. Simard, please.

November 22nd, 2007 / 9:55 a.m.

Liberal

Raymond Simard Saint Boniface, MB

Thank you very much, Mr. Chair.

I'd like to thank our witnesses for being here this morning.

Given that the service sector accounts for approximately two-thirds of the GDP in employment, I'd like to know if we also have some idea of how this split compares with other industrialized countries. It would seem to me that given that you have an average lower wage in the service sector, 70% may not be a good figure to have.

If the States are at 50:50 or if the European countries are somewhere closer to 50:50, maybe that's where we should be.

Could you give us an idea of where we stand there, please?

9:55 a.m.

Assistant Deputy Minister, Industry Sector, Department of Industry

Tom Wright

I don't have the international comparisons. As I was going through the deck this morning, it was a question I was putting to my colleagues.

Taking the suite of data that I have here--your question included--and how we look vis-à-vis the United States, Australia, the G-7, and what that tells us in terms of where we're at....

My apologies.

9:55 a.m.

Liberal

Raymond Simard Saint Boniface, MB

You can get that for us?

9:55 a.m.

Assistant Deputy Minister, Industry Sector, Department of Industry

Tom Wright

Indeed.

9:55 a.m.

Liberal

Raymond Simard Saint Boniface, MB

Thank you.

Do we have any idea how the various sectors are impacted when you face a downturn, for instance? I think it might be interesting, historically, to go back and see if the impact is more severe or less severe, if fully 70% of your GDP is in the service sector, when you face a recession or some kind of a downturn.

9:55 a.m.

Assistant Deputy Minister, Industry Sector, Department of Industry

Tom Wright

Yes, indeed. With a little more time, I think we could do some longer-term trend analysis. I think we're back to one of the questions earlier on trends--if I understand your question correctly--to capture downturns and how the economy responded vis-à-vis the service sector, we would have to do some very long-term.... We can try to pull some data to offer comparisons.

9:55 a.m.

Liberal

Raymond Simard Saint Boniface, MB

And you would also give comparisons between the sectors? For instance, is the manufacturing sector hit less severely than the service sector? I think that might be interesting, given that fully 70% of our service sector is....

9:55 a.m.

Assistant Deputy Minister, Industry Sector, Department of Industry

Tom Wright

We'd be happy to do a little bit of analysis and dig into some of the data. We'll do some long-term trends and compare those trends to, say, the G-7. We can do that.

10 a.m.

Liberal

Raymond Simard Saint Boniface, MB

Okay.

You also spoke of some of our champions--Manulife, Great-West, Sun Life. Actually, a lot of the Canadian champions, our big corporations, are in the service industry. Obviously some of their growth came about through very good management, but a lot of it came about through mergers. We also know that the reverse is possible, that you could be bought out by foreigners.

I wonder if you've looked at the possible impact of that, if Manulife or Great-West would be bought out by somebody else, because just the purchase of one or two of these corporations would have a huge impact on our economy.

10 a.m.

Acting Director, Financial Institutions, Financial Sector Policy Branch, Department of Finance

Colleen Barnes

Manulife and Sun Life are large demutualized insurers, and the government policy position is that they have to remain widely held. So there is, I guess, a policy prohibition in place for anyone to acquire those entities.

Great-West is a little different. It's owned privately by Power Corporation of Canada.

10 a.m.

Liberal

Raymond Simard Saint Boniface, MB

Thank you.

We're facing now the possibility of the impact of a labour shortage, but it's going to get a lot more severe down the road. I'm just wondering if you've looked at that.

I remember that Great-West Life has its headquarters in Winnipeg. When you used to get a Great-West Life job, it was a very low-paying job, very menial stuff, but I'll tell you, today they're very well-paid, sought-after jobs. I'm just wondering if you've anticipated, with the upcoming labour shortage, whether or not the service sector will be gaining. We're talking now a small difference in terms of average salaries.

Do you foresee that industry or that sector growing in wages comparatively to the manufacturing sector?

10 a.m.

Assistant Deputy Minister, Industry Sector, Department of Industry

Tom Wright

The question is a very good one. Again, I get hesitant with crystal balls, but suffice it to say that if you break it down into the sub-sectors where you can get some digestible chunks of data, and if you took a look at a sector like tourism, they are forecasting a labour shortage. I forget the precise figures, but by 2015 they think they're going to be short a sizeable number of people in that sector, so supply-demand is going to come to the fore one way or another.

Yes, in the longer-term, looking out, there is something coming. So the question I think is a legitimate one.