Thank you, Mr. Chair. I congratulate all the Boston Bruins fans for shaving their beards today. I still have mine.
I will start my remarks in French and finish them in English.
The situation of the manufacturing sector started to improve in 2010, after the great recession. Some macroeconomic indicators are announcing better days. Since 2011, the rate of plant capacity use has gone over 80%, which leads us to believe that capital and manufacturing expenditures will go up as the U.S. market picks up and companies will be faced with production capacity issues.
Investments in machinery and equipment are an indicator of productivity. In 2013, they were at their highest level since the recession, meaning at $14.3 billion. This fine performance is attributable in part to the federal government’s accelerated capital cost allowance. We feel that it is important for the federal government to keep a high accelerated capital cost allowance rate for machinery expenditures in order to facilitate investment and productivity gains.
The manufacturing sector currently has 1.73 million employees, whereas, in 2007, there were 2 million.
In 2013, exports almost reached their level prior to the recession. They are at $39.3 billion in goods, which is an increase of 34% since the 2009 low point.
However, research and development expenditures are a little more worrisome. Given the budget cuts to the scientific research and experimental development program, that was somewhat predictable.
Last year, research and development expenditures were close to their historic low of 2010, with a drop from 2011 and 2012. In my view, this performance is not likely to improve in the short term, given the elimination of capital expenditures in 2014 and the reduction from 20% to 15% of the research and development tax credit for large businesses from the federal government.
There are three areas in or related to Bill C-31 that are of particular concern for members. One is to keep supporting the companies that are facing labour and skills-shortage issues. While we agree that there should be no tolerance for abuse under the temporary foreign workers program, our members are concerned with the current uncertainty of the program.
We get calls from members asking, “Am I still okay buying this next piece of equipment if I need to bring those foreign workers here to set it up and to get some training?” There are a lot of questions. Not all of them are necessarily touched by the current situation with the program, but there is uncertainty.
Our member survey indicated that, year after year, more than 50% of our members are facing skills and labour shortages, and most of them think the situation will get worse in the future. One of our recommendations is to really make sure that we keep a foreign skilled workers program specifically for the advanced manufacturing sector.
The second area of concern is with division 3 of part 6 of the bill, which amends the Hazardous Products Act to implement the globally harmonized system of classification and labelling of chemicals. CME supports the benefits of harmonization of safety data sheets and labels on products used in the workplace. Canada, however, must make sure that all labelling requirements are fully harmonized with those in the U.S., so that companies do not have unnecessary costs related to relabelling products if there is a lack of harmonization.
We also think that importers of chemical products should be able to label their products here in Canada without the obligation to label them in the country of origin prior to their importation, as is currently required in the legislation.
I would like to say a few words on the Canadian International Trade Tribunal as well. Our members' competitiveness relies on high-quality assistance from the Canadian International Trade Tribunal to make sure that their competitors compete according to the rules. Division 29 of part 6 is proposing to remove the Canadian International Trade Tribunal's budget, research staff, and registry and to consolidate these into the administrative tribunals support service of Canada.