Thank you, Mr. Chair.
I represent the Centrale des syndicats démocratiques, which is a Quebec labour federation with nearly 70,000 members, most of which are SMEs and manufacturing sector businesses from all regions of Quebec. Today's subject is a great concern for us and we are very pleased to be invited to appear before this committee.
Before the Free Trade Area of the Americas was adopted, in fact from 1993 to 2000, the Quebec manufacturing sector created 108,000 jobs. The sector reached a peak of 667,000 jobs in 2002. In 2006, four years later, the number of jobs in the industry had fallen to 488,000.
Some sectors have obviously been harder hit than others. Those exposed to international competition, in particular the clothing industry, have suffered more. It is important to bear in mind, when we talk about job losses in the Quebec manufacturing sector, that more than 200 municipalities are single-industry towns. Consequently, a plant closing in those municipalities has a negative impact not only on the workers of the business, but on the community as a whole.
The present situation is very disturbing. In addition, the crisis that the Quebec lumber and logging industry is going through affects more than half of those single-industry towns. Asian competition, the stronger dollar and the slowdown in the U.S. economy are other factors that have a major impact on jobs.
The overall analysis of the manufacturing sector reveals certain dangers, because the realities are many. This is a complex and multidimensional issue, and the problems differ greatly from sector to sector.
A large business employing several thousands of workers lives in a different world than that of a small or medium-size enterprise with 15 to 20 employees. Similarly, the geographic and demographic situations are other factors that must be taken into account in our analysis of the manufacturing sector.
What is for certain, however, is that the manufacturing sector creates a lot of direct and indirect jobs. The indirect job coefficient in this sector is very high. So this sector must be taken into consideration, particularly since, traditionally, it has always created high quality, well paid jobs. I use the word “traditionally” because this trend appears to be changing.
Despite the various characteristics that I have just outlined, we'll nevertheless try today to provide you with certain potential solutions which we think are universal. I draw these facts from an experience we had in Quebec. A number of you are no doubt aware that the Charest government organized the Forum des générations in the fall of 2004, to which he invited various civil society organizations to take part.
Two Quebec labour federations attended the Forum: the CSD and the Fédération des travailleurs du Québec, the FTQ. At the Forum des générations, we requested that a working committee be established to look into the future of the manufacturing sector, because we were concerned about the situation.
The committee was created and chaired by Gaétan Lussier. The committee's work was spread over a number of months. A report was prepared and was the subject of a consensus by the four union federations — CSD, CSN, CSQ and FTQ — and management organizations of Quebec. I'll send a copy of the report to the committee secretariat. The report proposes 70 economic and social measures that take into account the jurisdictions of Quebec and Ottawa for the purpose of supporting the manufacturing sector in its efforts.
I'd like to talk to you about that study by addressing two aspects. First of all, if we want to keep high-quality jobs in the manufacturing sector, we must ensure that our businesses are competitive. To do that, we must make efforts. The problem is that a lot is said about productivity; in fact, a lot of nonsense is said. And yet there is an academic literature on the subject, from the Université Laval, the HEC and elsewhere. Mr. Anthony Giles, who is Director General, International and Intergovernmental Labour Affairs at Human Resources and Social Development Canada, made excellent presentations on productivity.
According to Mr. Giles, there are three main ways of increasing productivity. The first is to intensify work, which is the worst solution. The second is to invest massively in technology; our businesses have scarcely invested in this area in recent years. The third is work reorganization; this is the way that produces the most significant productivity gains. However, work reorganization must be done in partnership with the union and employees.
First finding: promote as much as possible the introduction of participatory management in the work place and support these social innovations in order to permit a genuine increase in productivity.
The second point I would like to address concerns a study conducted by Laval University. That study showed that the best performing businesses from an economic and social standpoint are those that use a participatory management model developed on the basis of the partnership between the union and the employer, as well as on employee participation.
This participatory management model needs help in order to spread. Better practices, particularly in human resources, are necessary in order to ensure business productivity. An SME with 10 to 15 employees, as well as most developing businesses, unfortunately does not have the necessary resources to develop the best human resource management practices. Innovative efforts in this direction must therefore be supported through policies. We must innovate in order to support businesses.
The issue of corporate governance must also be addressed, more particularly the abolition of the capital tax. If you decide to abolish that tax, business leaders must be required, in exchange, to make massive investments in their businesses. Otherwise, everyone will lose out.
In the wake of the Forum des générations, the CSD and the FTQ examined the phased retirement issue and filed a brief with the federal government, which is now with the Department of Finance. It is important to review that brief because a good phased retirement program, given our demographic issues, would enable people to work an average of one, two or three years more. Such a program is important in the context of the aging population and labour force.
We must also step up our investments in manpower training in order to develop greater employability.
I apologize for going beyond my time.