Evidence of meeting #9 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 dollar.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

  • Perrin Beatty  President and Chief Executive Officer, Canadian Chamber of Commerce
  • Jayson Myers  President, Canadian Manufacturers & Exporters
  • Mark Nantais  President, Canadian Vehicle Manufacturers' Association
  • Avrim Lazar  President and Chief Executive Officer, Forest Products Association of Canada
  • Michael Murphy  Executive Vice-President, Policy, Canadian Chamber of Commerce

5:05 p.m.

President, Canadian Manufacturers & Exporters

Dr. Jayson Myers

They're certainly feeling the downturn in the U.S. market in those three key areas of housing, automotive, and consumer products. Many companies are also saying that as a result of credit problems in the United States their customers are having more difficulty paying, and they're finding later payments as a result of that.

Within Canada it's not so much the impact of the credit market per se as the fact that cashflow is under pressure--

5:10 p.m.

Liberal

Raymond Simard Saint Boniface, MB

Your bank has to be there for you.

5:10 p.m.

President, Canadian Manufacturers & Exporters

Dr. Jayson Myers

--and therefore bank lending is also under pressure. In that sense a credit facility like EDC, where they guarantee bank loans for investment on the part of exporters in new technologies, is a very positive program. It would be nice to see that expanded across the supply chain for exporters as well.

5:10 p.m.

Liberal

Raymond Simard Saint Boniface, MB

We also had the municipalities come to the Hill a couple of weeks ago to talk about this $120 billion to $130 billion infrastructure deficit. I know Mr. Lazar spoke to it briefly. How important is that to your competitiveness? If the government were to act on that, where would the priorities be--roads and bridges, transportation? I guess it would vary by industry, but you must have some priorities there.

5:10 p.m.

NDP

Brian Masse Windsor West, ON

The Windsor bridge.

5:10 p.m.

Conservative

The Chair James Rajotte

I know you have priorities, Brian.

5:10 p.m.

President and Chief Executive Officer, Canadian Chamber of Commerce

Perrin Beatty

More infrastructure would be a very good place to start. We have serious problems there. The impact upon industry is very direct, and if we can cut the various Gordian knots that exist in moving ahead and accelerating investment and border infrastructure, it will be a major shot in the arm for industry.

5:10 p.m.

Conservative

The Chair James Rajotte

You have 30 seconds.

5:10 p.m.

Liberal

Raymond Simard Saint Boniface, MB

I had the pleasure of visiting a plastic extrusion business in Winnipeg lately and was told that people are finding markets elsewhere in the world. How can people basically ramp up and provide these products in such a short period of time? How does that happen? Or are they just there and ready to sell to the U.S.?

5:10 p.m.

President, Canadian Manufacturers & Exporters

Dr. Jayson Myers

I think many companies have very specialized products and have been relying on the U.S. market for a long time. They are now in the position where they have to find other markets, so they're putting a lot more effort into new market development. It's more difficult for small companies, in terms of where to go to find a reliable partner/distributor in these markets. We've already seen the overall percentage of our exports to the United States fall from 87% to 75%.

So companies are definitely looking at new markets, particularly in Europe, Australia, Japan, and China, but it depends on the business strategy. It comes down to the ability of businesses themselves to adjust their marketing, but in order to do that you need a new design, products that meet new regulations, and products that will match customer expectations in these markets.

On the infrastructure issue, I think we could do a lot for Canadian manufacturers and Canadian business as a whole if we put in place a program like the United States has--a buy-Canada program for infrastructure spending or government procurement spending, at least at the municipal and provincial levels in Canada.

5:10 p.m.

Conservative

The Chair James Rajotte

Thank you.

We'll go to Monsieur Petit.

You have five minutes.

December 5th, 2007 / 5:10 p.m.

Conservative

Daniel Petit Charlesbourg—Haute-Saint-Charles, QC

My question is for Mr. Lazar or Mr. Beatty.

Mr. Lazar, I heard your description of the forest industry. In Quebec, my province, there are a lot of forest product companies that come under the federal Labour Code. Transportation, railways, air transport, telephone services and even, in some cases, water transportation such as barges and ships are regulated under the Canadian Labour Code.

You have kept saying this morning that our dollar is too strong, that it rose too fast and that this has caused all sorts or problems.

What do you think of the fact, Mr. Lazar, that the Liberal Party tabled a bill called Bill C-415, An Act amending the Canadian Labour Code (Replacement workers)? If the high dollar causes you a problem, imagine what would happen if you had a strike on your hands and were unable to do anything about it.

I would like to hear your opinion. People talk about partisanship. But you are here representing employers, and these employers obviously have employees. Are we not erecting barriers for businesses? I cannot put this question to Mr. Nantais since his company is entirely unionized. But you may still have some room to move, an opening. But his industry is completely unionized.

So I would like to know your opinion and that of Mr. Beatty on this subject.

5:10 p.m.

President and Chief Executive Officer, Forest Products Association of Canada

Avrim Lazar

The competitiveness of labour costs is a big piece of keeping jobs in Canada. We've done an analysis of labour costs in Canada relative to our productivity. Our labour costs in the forest industry are the highest in the world. Our labour productivity is middle of the road.

We've done a further analysis that shows that as we increase the sophistication of the machinery in Canada, our increase in labour productivity does not sufficiently reflect the increase in the sophistication of the factory. For example, in Europe, you see a one-on-one movement: a sophisticated machine, and labour productivity goes up. In Eastern Europe, it's almost a flat curve; no matter what they do, the labour productivity is poor.

In Canada, it's middle of the road. We do not translate our sophisticated machinery into sufficient improvements in labour productivity. We're doing a study to find out why, but it's pretty clear that it is because of work organization, that our history of management-labour relations has built-in rigidities that are, to some extent, holdovers from the past. In Europe, even though they're highly unionized and there's a lot of protection for the workers, they know how to work with management to improve productivity. We are still in a more adversarial frame of mind.

So if you wanted to ask, what's the solution, the solution lies both with management and with labour to learn how to translate investment in machinery into productivity, because without productivity, we can't keep jobs.

Specifically—I wasn't dodging your question; I was contextualizing it—do we think we need labour laws that would increase the divisiveness, the polarization, in Canada's marketplace? I don't think we need that right now. I think what we need is to work together to keep the jobs in Canada.

5:15 p.m.

Conservative

The Chair James Rajotte

Mr. Beatty.

5:15 p.m.

President and Chief Executive Officer, Canadian Chamber of Commerce

Perrin Beatty

Your question was addressed to me as well, and if I understood your question correctly, you were referring to the private member's bill that deals with replacement workers. We strongly oppose the legislation. We think it would be very damaging to the Canadian economy.