Industry and Technology Committee on Dec. 1st, 2025

[The Chair, Liberal, Ben Carr]

All right. Good morning, everybody.

I hope you had a good weekend.

We have two weeks left before the Christmas break. It's coming.

We are continuing our study on Canada's productivity.

This is our last scheduled meeting on productivity. We've had a really good set of discussions on this over the course of the past couple of months. We have two final witnesses appearing here today virtually.

The witnesses have completed the required sound tests in advance of the meeting.

Witnesses, to make sure that interpretation is working in both languages, could you give me a thumbs-up? Excellent.

You will each have up to five minutes to provide introductory remarks.

We will start with Protect Our Winters Canada, and Natalie Knowles, a researcher with the organization.

Ms. Knowles, we'll turn the floor over to you for up to five minutes.

[Natalie Knowles, Researcher, Protect Our Winters Canada]

Thank you so much for having me here today to speak on behalf of Protect Our Winters Canada. This is a non-profit representing Canada's outdoor recreation industry.

My name is Dr. Natalie Knowles. I'm POW's research and policy director, and I specialize in research related to outdoor recreation economies.

I'm the co-author of a report released in 2024 that, for the first time, analyzed Canada's outdoor recreation economy. This sector is an underappreciated economic powerhouse, representing $101.6 billion in annual economic activity and over one million full-time jobs.

The outdoor recreation sector stands above or at par with other major industries, including forestry, agriculture, pharmaceuticals, and oil and gas. However, this report underestimates the size of outdoor recreation to Canadians, because it was based on existing outdoor recreation sector reporting and doesn't include many key subsectors that millions of Canadians participate in due to the diversity of the outdoor recreation industry and the lack of coordinated economic impact assessments at the regional, provincial and national levels.

Our outdoor recreation economy report for Canada shows that outdoor recreation is a major industry across our country. It's the lifeblood of countless rural communities across Canada, especially some communities whose economies are naturally transitioning from traditional resource economies. Outdoor recreation is growing rapidly, but contributions to our national economy are not being reported.

For comparison, there was a similar situation in the U.S., but a few years ago, the U.S. Bureau of Economic Analysis added an outdoor recreation satellite account, finding that outdoor recreation creates $1.2 trillion in economic output and represents 2.3% of their overall GDP. This economic reporting has not only helped better understand the economic impact, but also led to direct policy and investment by both the public and private sectors.

In addition to our estimates on the economic impact, outdoor recreation is a labour and workplace productivity booster. Participation in outdoor recreation activities by Canadians, particularly in natural settings, has been proven to reduce stress, anxiety and depression; improve mental health; enhance cognitive functions like creativity, problem-solving, innovative thinking, focus and mental clarity; increase physical health, well-being, cardiovascular health and immune function; strengthen social well-being, team building, interpersonal relationships and supportive workplaces; assist in youth development and healthy aging; and lead to higher job satisfaction, a sense of purpose and fulfillment and less burnout in the workplace.

These benefits of outdoor recreation transcend the sector and can contribute to stronger workforces, more resilient businesses and greater productivity across all industries and regions across Canada. Investment in outdoor recreation assets, like trail networks, green spaces and bike shares, by the government and the private sector alike can help attract and retain workforce talent.

We're finding that millennials, high-income individuals and households with children are more likely to consider outdoor recreation and access to nature in their residential and employment decisions. Beyond the direct workforce, outdoor recreation provides a broad range of social benefits that strengthen our economy as well as the individual and community health of Canadians.

Healthy lifestyles associated with outdoor recreation are estimated to reduce public health care costs in Canada by between $3.9 billion and $23 billion annually. For rural communities, recreation means attracting new residents, having faster-growing economies, enhancing active citizenship and improving the sense of belonging among new immigrants to Canada. There's also been evidence that it can support truth and reconciliation, particularly call to action number 92 on building respectful relationships and ensuring that indigenous communities gain long-term economic benefits from activities taking place on their lands or from using their resources.

From skiing to mountain biking, canoeing rivers to hiking through the forests, our diverse outdoor recreation options and vast natural playgrounds are a key piece of Canadian culture, well-being and livelihoods that transcend political differences. As such, we believe that to boost Canadian productivity and competitiveness, we call upon the government and this committee to support the sustainable growth of the outdoor recreation sector by starting to report on Canada's outdoor recreation participation and economic impact, as has been done in the United States to much success, and by investing in and protecting natural outdoor recreation assets and infrastructure so we can continue providing productivity within the outdoor recreation sector and in other sectors across Canada.

[The Chair, Liberal, Ben Carr]

That's wonderful. Thank you very much, Ms. Knowles.

Mr. Meier, I have been accused of being partial to Manitobans in the past. I'll do my best to be as impartial as possible, but it's very nice to see you, sir.

For colleagues who don't know, Mr. Meier is the president and CEO of Red River College Polytech, which is located in my hometown of Winnipeg.

Mr. Meier, it's always a pleasure to see you. I turn the floor to you for up to five minutes.

[Fred Meier, President and Chief Executive Officer, Red River College Polytech]

Thank you very much, Mr. Chair and members of the committee, for the invitation to appear today.

As the chair mentioned, my name is Fred Meier. I'm the president and CEO of RRC Polytech, which is Manitoba's only polytechnic institution. I'm joining you today from our Notre Dame campus in Winnipeg, which is located on Treaty 1 territory and the national homeland of the Red River Métis.

In March 2024, Carolyn Rogers, the senior deputy governor of the Bank of Canada, focused a spotlight on the productivity crisis in Canada. It’s now widely recognized that our country is in trouble. As the president of a polytechnic institution, I want to share a perspective that doesn’t get the attention it should.

Colleges and polytechnics provide the skills and credentials that drive productivity in virtually every economic sector in every region of our nation. Institutions similar to ours play a more significant role in countries around the world that are leading in productivity.

Our collaborative applied research activities with industry partners advance innovation through adoption and the dispersion of technology. We’ve built incredible trust with business partners and have proven that we can deliver what they need. Our partnerships are deep and our outputs help elevate Canada.

Polytechnics Canada's 13-member institutions alone accounted for 138,000 job-ready graduates in 2024–25. More than 18,000 of them worked on applied research projects while they studied.

Colleges and polytechnics have the ingredients to help grow productivity in Canada, yet funding, policy decisions and the general optics of colleges and polytechnics compared to universities continue to support a hierarchy and advance a systemic disadvantage. Colleges conduct the majority of Canada’s SME-focused, industry-driven applied research, yet we receive less than 3% of the tri-council’s total budget for research funding. This imbalance makes it difficult to scale the kind of productivity-enhancing innovation and technology adoption that keeps investment in Canada. It limits the growth of benefits we can provide to Canadian businesses.

More and more within post-secondary, we’re seeing signs that our peers recognize how important colleges and polytechnics are in helping businesses turn innovation into productivity and profit. Last year, RRC Polytech became a partner and lead of Labs4, a national network of 38 colleges and universities helping researcher-entrepreneurs turn academic breakthroughs into real-world ventures, products and solutions. We received the largest ever tri-council grant to be awarded to a college—more than $24 million—and recognition from Ottawa that applied research by polytechnics and colleges is a catalyst of productivity in Canada. It was a big win and a step in the right direction for research funding in post-secondary education and, equally important, for something I call parity of esteem.

Colleges and polytechnics need to be seen as different from but equal to universities as contributors to Canada’s success. The current hierarchy in post-secondary education is counterproductive to what the sector can generate when we work together and when our unique strengths are advanced and equitably funded.

Canada’s SMEs employ more than 16 million people and comprise 98% of all businesses in our country. They don’t have massive R and D budgets. They need rapid access to graduates who have applied knowledge, work experience and the technical skills to implement and optimize technology quickly.

We fill that gap. We help them work with existing technologies so they can become digitally literate and competent, now. We do all of this in partnership with industry and through foundational industry support.

RRC Polytech’s ability to support Manitoba SMEs in manufacturing transformed in 2023 with the launch of the Price Institute of Advanced Manufacturing and Mechatronics, which was possible in large part due to the vision and generosity of Dr. Gerry Price. The institute's Centre for Automation and Manufacturing Technology Transfer now connects SMEs with our research experts and students to rapidly explore new technologies and then adopt them into their operations. It’s just one example of the mutually beneficial outcomes we provide for students, industry and community partners, and for Manitoba and Canada.

We drive productivity. We want what you want for Canada. We can do more, but that requires more—more funding for applied research, greater recognition as a viable post-secondary option for more Canadians and parity of esteem.

Thank you for your time this morning. I encourage you all to visit colleges and polytechnics and learn more about the impact they have on productivity across the country. I look forward to hosting you at RRC Polytech.

[The Chair, Liberal, Ben Carr]

Thank you very much, Mr. Meier.

Colleagues, we will now enter into our lines of questioning.

Witnesses, just so you're aware of the order of things, I'll let you know that there's a pre-allotted amount of time per recognized political party around the table, and we follow that pattern.

Madam Dancho, the floor is yours. You have six minutes.

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

Thank you, Mr. Chair.

Thank you to the witnesses for their opening statements.

Mr. Meier, I have questions for you.

It's great to see you again. I appreciate the number of tours you've provided to me to get a better sense of what we're doing in Winnipeg. Overall, I took away from those tours that polytechnics are very much leading the way in bridging the gap of advanced manufacturing in Canada by working with private sectors to commercialize one of these incredible Canadian ideas.

I want to ask you a bit about that because we're studying productivity. Our biggest competitor and biggest trading partner, of course, is the United States. As you know, its productivity has gone leaps and bounds ahead of ours over the last decade. In fact, as you may know, real U.S. manufacturing and construction are up by over 300% since 2008, and ours have been really flat during that time. U.S. firms invest triple what Canadian firms do in productivity-related technologies—about $12,800 annually per worker while we're at $4,100 annually per worker—so they really have advantages over our Canadian workforce.

I'm wondering what role polytechnics play in innovation and advanced manufacturing. How critical is it that we support that as taxpayers and as government to ensure that we can close the productivity gap with the United States?

[Fred Meier]

Thank you very much for your question. It's a good one.

I touched on that briefly in my comments on applied research. For those who haven't spent a lot of time in the applied research area, I'll say that applied research is done in partnership with industry. It's not related to the discovery research. It's very much focused on a problem or an innovation that a business owner and industry are looking for. Polytechnics and colleges across Canada are the one of the only areas from which applied research can be delivered in Canada. It's also done in partnership or in conjunction with students who work very closely on those projects.

What's happening in that environment is that a company will come into a polytechnic or college that has applied research capabilities. It will work with researchers, who are our staff members with industry-level experience. They'll work on prototyping or developing a product that a company has—either an existing product that needs to be changed or one that needs to be modified using new technology. At the same time, we have students involved in that process. What you're getting is a company that's working in a public institution with available public funding and in conjunction with students and researchers. The other thing that's quite unique about applied research in our institutions is that intellectual property brought into that environment is retained by the company or the partner we're working with in that environment. That reduces the barriers to entry. That allows companies to enter, without risk, into that environment.

The other thing we've seen quite often is that the students who are involved in those projects end up having the skills and talent required for that company to move on and implement the technology they've just developed in our research facilities. It's an ability for them to access talent. It's an ability for us to develop talent, and it's an ability for us to help companies, especially companies that don't have the size for their own in-house expertise for research, to access facilities, equipment and researchers to do that.

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

I believe it's the case that every dollar invested in applied research carried out by polytechnics generates a combined private and social return ranging from a low estimate of $8.09 to a high estimate of $18.49. It's one dollar in and up to almost $19 out in economic activity.

You also mentioned in your opening remarks that with the tri-councils—the government research councils that distribute taxpayer funding for research and development—97% of funding goes to universities and only 3% goes to polytechnics. Is that correct? Also, was there any movement on that in the recent budget put forward by the federal government?

[Fred Meier]

Yes, that is a historical trend. I don't think we've ever seen colleges or polytechnics exceed the 3%. It's somewhere below 3% that we've seen. The biggest one is the college and community innovation program, which is a direct stream for polytechnics and colleges to access.

The one thing that we were looking for in the budget was an extension of a top-up received in 2023 to that program. That was an additional $36 million to $40 million for the program. We didn't see that in this budget, and we're seeking clarity on that right now. It expires in April 2026, which will reduce the capacity of the work we can do in polytechnics and colleges.

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

On the value for money that's going in from taxpayers, and to help make the argument, I would agree that polytechnics deserve a larger portion of funding, whether the overall funding envelope goes up, as yours does, or whatever it needs to be, but I think 97% and 3% are quite disproportionate. More than that, I believe polytechnics leverage $2.24 from other sources for every dollar invested. It's not just taxpayers burgeoning publicly funded research. The private sector is also supporting that. I think that's important, and it's higher for polytechnics than it is for universities. Again, the economic output, as I mentioned, is quite high.

In our last minute, do you have one or two recommendations to government to ensure that we maximize polytechnics in advanced manufacturing? I'm almost out of time, so please be brief.

[Fred Meier]

If you look at countries that lead in productivity, the investment in applied research is higher as well. The other thing is that in order to drive productivity in our country right now, we need the skills and talent coming out of these institutions.

[The Chair, Liberal, Ben Carr]

Thanks very much, Madam Dancho.

Mr. Bardeesy, the floor is yours for six minutes.

[Karim Bardeesy, Liberal, Taiaiako'n—Parkdale—High Park, ON]

Thank you very much.

I'll start with you, Mr. Meier. I want to pick up on the points about applied research.

Earlier in this committee, we heard that it's important not just to take a global perspective on productivity numbers but also to try to really drill down in sectors and regions. Could you share with us, from a Red River College perspective, the major areas that you think you have a role in advancing the productivity of in the region of Winnipeg and southern Manitoba?

[Fred Meier]

I would say it holds true for many of the institutions that we're very focused regionally in the types of programs we deliver. The legislation that established our institution says that we were established to focus on our labour market locally. That's the talent and programs we develop and, alongside that, the applied research we deliver. For us, in advanced manufacturing and mechatronics, as I mentioned, we have not only a technical access centre but also a new institute that's focused on that. We've opened the doors on some new facilities as well to really drive it. For Manitoba specifically, that's one.

The other one I would mention is transportation. We were a very early adopter of emerging propulsion systems and energy systems for large and heavy vehicles. Our partnership with New Flyer Industries, a manufacturer of hydrogen and hybrid electric buses, is of long standing. We work very closely with them. We have developed facilities to help them test their equipment. We were their early-stage developer of some of the recharging technologies associated with that as well.

On the agricultural front, of course, in Manitoba and across the Prairies, ag is a driver of what we do. We have a very specific area, called our Prairie Research Kitchen, that works on applied research on food development products. It's unique. It not only has the lab strength and the applied aspects around food development; it also has a connection to our culinary program. It really brings chefs into the equation on applied research and product development to get it ready for market.

Those are some of the areas we focus on. Energy efficiency is also a very strong one for us. We have a building efficiency technical access centre that works on improving the efficiencies of structures in construction as well.

[Karim Bardeesy, Liberal, Taiaiako'n—Parkdale—High Park, ON]

One of the features of what you've described is that Winnipeg has the quite unique position of not only being a major centre, but also being quite distant from other major centres. Where do you tend to attract your student population from? How does that speak to the productivity challenges you see in the region?

[Fred Meier]

The majority of our students are local students. They would be domestic to Winnipeg and Manitoba. A smaller proportion would be the international students we've attracted as well. We find that the retention of our graduates within Manitoba is very strong because of the high level of domestic students we have and the regional connections we have.

We also have a very strong work-integrated learning component. This component ensures that all of our students have an opportunity to have a work placement, a co-op or an internship, or to work on a capstone project specific to a company or an employer. That level of high retention allows people to stay within Manitoba. It also allows them to be prepared to enter the labour market much quicker and without barriers.

[Karim Bardeesy, Liberal, Taiaiako'n—Parkdale—High Park, ON]

Thank you.

I now have a couple of questions for Ms. Knowles.

Ms. Knowles, you're in a sector where spending is more, I guess you could say, discretionary—it has more of a discretionary element.

First, could you share what you're expecting this coming winter—what the trends are you've heard from your members—and the analysis you've done?

[Natalie Knowles]

In terms of the trends this winter, we're seeing increased outdoor recreational participation and spending, which generally has been increasing rapidly. Since COVID, there's been a major increase in spending and participation in outdoor recreation. We are seeing impacts from climate change and other environmental and political factors that influence how and where people are participating and, therefore, spending their money on outdoor recreation.

The current relationship with the U.S. is leading to a greater increase in domestic, localized spending on outdoor recreation, which is a positive step for our outdoor recreation sectors in Canada. There are fewer people travelling across the border for things like skiing and the other activities they would potentially do. That's where we're seeing growth in the same sense that we saw during the period of COVID.

[Karim Bardeesy, Liberal, Taiaiako'n—Parkdale—High Park, ON]

One of the conventional metrics for productivity that this committee has looked at is increased output per worker, but in your sector it's probably a bit harder to do that. Can you share with us your perspective on the question of productivity as it relates to a sector like yours?

[Natalie Knowles]

It's an interesting question, because when we look at productivity in the traditional sense of output per worker, what we see with outdoor recreation is the low requirement for resource input relative to labour. There's less resource input in terms of economic output. Outside of our specific sector, the increase in productivity or the effectiveness of workers in other sectors due to participation in outdoor recreation.... It's an interesting sector, and when we look at traditional economic impact metrics, it's much more difficult to assess and relate to other sectors. However, when we look at jobs and the economic impact, we see that we're at par with other sectors.

In the outdoor recreation sector, often we are much more interested in some of the more qualitative, difficult-to-measure economic impact assessment metrics. By that I mean looking beyond GDP and direct productivity metrics and at some of the more social and well-being aspects that outdoor recreation provides to those within the sector—to the small businesses in it. The sector is generally built out of small local businesses. We're looking at some of the contributions to local economies, regional and provincial economies, and then outward.

[Karim Bardeesy, Liberal, Taiaiako'n—Parkdale—High Park, ON]

Thank you. That's very valuable for our work here.

[The Chair, Liberal, Ben Carr]

Thanks very much, Mr. Bardeesy.

Mr. Ste‑Marie, go ahead for six minutes.

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

Thank you, Mr. Chair.

Greetings, everyone.

I'd like to thank the witnesses for being with us and for their testimony.

Mr. Meier, thank you for your presentation. I would like to come back to the issue of intellectual property and the innovations that are being made at colleges, universities and polytechnics. You talked about partnerships with businesses and the agricultural community. We often hear that, in the Canadian economy, there is a problem with properly protecting patents, intellectual property and innovations that are made in colleges and universities and that are transferred to businesses to increase their productivity. Can you tell us more about that from your perspective?

[Fred Meier]

IP is a critical aspect of the productivity equation as well. It usually comes from the feeling or the fact that IP is commercialized elsewhere. It's discovered in Canada and commercialized elsewhere. Within that is an ecosystem that, at certain points in time, can be quite leaky or can be difficult to operate inside of.

Maybe I'll speak about this from what we believe the advantages of working with polytechnic institutions are in an applied nature.

The first one I spoke about was reducing a barrier. We'll take, for example, lab research. There's a researcher or somebody who's discovered something and wants to look towards the commercialization of it. The first barrier that we think we reduce is.... By removing the sharing of IP by working inside of our institutions, it allows them to step into an environment where that threat isn't there. That's the first part of it.

The second part is the ability for us to connect with industry. We have a wide network of industry partners we work with on a regular basis. That connection allows us to provide that researcher, the person bringing the IP into our institution, to have a better sense of how that's connected.

The other thing is the ability for us to move rapidly and understand the marketplace and what's required on that front for us to put in the necessary advice for and development of a product, and then also provide the skills and talent for the next steps for commercialization. What are the business skills you need to move that forward? I would say that if we had a greater capacity within the polytechnic-college applied area, it would allow for more commercialization of research within facilities that have the researchers and the know-how to do that.

It's exactly what the Labs4 initiative was focused on: the ability to connect with universities and colleges together as part of a network. There's extremely valuable research that's done and discovered. We need to find a way to commercialize that, taking it from the lab to the market and having polytechnics and colleges involved in that process.

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

Thank you very much. That's very enlightening.

Still with a view to increasing productivity, do you have any recommendations for the federal government to facilitate this networking—these partnerships and transfers?