CHAIR'S FOREWORD

Canada's manufacturing sector is a vital component of our economy. Manufacturing is Canada's largest business sector, accounting for 17% of all of Canada's economic activity and providing employment for 2.1 million people. Additionally, every dollar of manufacturing output is estimated to generate over three dollars of total economic activity.

While the rest of the Canadian economy is generally very robust, many industries within the manufacturing sector are struggling to remain competitive against the backdrop of a Canadian dollar that has risen in value by more than 40% in just four years in comparison to its American counterpart, rising and unpredictable energy costs, increasing global competition, particularly from China and India, and excessive and inefficiently designed regulations, to name but a few challenges.

The Committee has completed an intensive study of the challenges facing the manufacturing sector. It began its hearings in May 2006 and tabled an interim report so that the federal government was made aware of the challenges facing the manufacturing sector and the potential solutions proposed by the witnesses. In October 2006, the Committee picked up where it left off, holding more meetings with witnesses and undertaking site/shop floor visits of a number of manufacturers located across the country.

The Committee's final report reflects a wide perspective on the challenges facing the manufacturing sector. Given that the downturn in the manufacturing sector reflects structural changes in the economy and not a cyclical downturn, the Committee believes that different policies are required than those implemented in the past. The report offers specific recommendations to the Government of Canada on how it can help the sector adapt to the challenges it is facing. The Committee believes that the Government of Canada should make the preservation of a competitive Canadian manufacturing sector a national goal, and that given the gravity of the challenges facing the sector, the recommendations presented in this report should be implemented in a timely fashion.

I would like to thank all of the witnesses who have appeared before the Committee in Ottawa and across the country and the company officials who welcomed the Committee to their places of business. I also thank the members of the Committee for their hard work on this study.

James Rajotte, M.P.
Chair