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 services.
A recording is available from Parliament.
Liberal
Raymond Simard Liberal 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.
Assistant Deputy Minister, Industry Sector, Department of Industry
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.
Liberal
Raymond Simard Liberal 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....
Assistant Deputy Minister, Industry Sector, Department of Industry
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.
Liberal
Raymond Simard Liberal 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.
Acting Director, Financial Institutions, Financial Sector Policy Branch, Department of Finance
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.
Liberal
Raymond Simard Liberal 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?
Assistant Deputy Minister, Industry Sector, Department of Industry
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.
Conservative
Liberal
Raymond Simard Liberal Saint Boniface, MB
I was always told that tourism is the biggest employer in the world in that sector. Can you confirm that for me? It's not in Canada, obviously, but could you verify for us that the tourism sector is where most people are employed?
Liberal
Raymond Simard Liberal Saint Boniface, MB
It's just that I've been telling everybody that about tourism, and I want to make sure it's true.
Assistant Deputy Minister, Industry Sector, Department of Industry
We'll attempt to find the data. I hadn't heard it quite that way.
Conservative
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
Thank you, Mr. Chair.
Thank you, visitors, for your presentation. It's excellent. There are so many questions. I have just a few small ones.
Mr. Simard actually touched on the first question I was going to ask. We do need that information from the other G-8 nations to see whether or not we are in line with them.
I'm wondering, though, whether modernization is a result in manufacturing decrease and service increase. Has there been a study done on modernization of a nation? As we mature as a nation, is the result a lowering in manufacturing jobs and an increase in service jobs?
Assistant Deputy Minister, Industry Sector, Department of Industry
I'd have to go to look to see whether the OECD or some of the academic institutions have done some studies along those lines. I think I understand your question and the thesis underlying it, but I'd have to go to take a look and consult with our people.
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
The other thing I was rather surprised to see, in fact more than surprised, was that this trend has continued since 1946. That's why I'm wondering if this is as we change as a country and as we start to have different needs, or if it's just a result of modernization. I'm thinking of computers. Perhaps we could just get some information on that.
There was some great information from the finance department. I'm glad to hear that we don't anticipate what has happened in the U.S. We have good Scottish bankers, and that's a trend.
On Canadian savings, where are we in comparison with other nations?
Acting Director, Financial Institutions, Financial Sector Policy Branch, Department of Finance
In terms of savings rates?
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
Yes. Historically, are we moving away from saving? Or are Canadians beginning to save a little bit more?
Acting Director, Financial Institutions, Financial Sector Policy Branch, Department of Finance
I'd have to go and look at the data. Certainly, I think in countries where capital markets are more developed you might find over time savings have gone down as people are more comfortable investing in capital markets and equities and corporate debt and that kind of thing, but I don't have the data here.
Is it comparisons as well that you'd be interested in?
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
Yes. Again, I think that's a healthy indication.
The other thing you mentioned, Ms. Barnes, was that 50% of the insurance industry is foreign. Is that something we can grow? Can we become a Swiss banking nation? It seems like we do a very good job. We have some big players.
