It’s Bigger Than You Think: Non-Resource Manufacturing in BC

In British Columbia the processing of resources is a highly visible part of the manufacturing sector, particularly the processing of logs harvested from the province’s forests. But non-resource manufacturing is also a significant part of the provincial economic landscape.

This issue of Policy Perspectives takes a closer look at non-resource manufacturing in British Columbia. The sector comprises a bigger piece of the industrial base than most people realize. Looking ahead, we see non-resource manufacturing as a promising source of economic and export gains for British Columbia.

In British Columbia the processing of resources is a highly visible part of the manufacturing sector, particularly the processing of logs harvested from the province’s forests. But non-resource manufacturing is also a significant part of the provincial economic landscape.

This issue of Policy Perspectives takes a closer look at non-resource manufacturing in British Columbia. The sector comprises a bigger piece of the industrial base than most people realize. Looking ahead, we see non-resource manufacturing as a promising source of economic and export gains for British Columbia.

Highlights

• Despite making sizable contributions to the province’s economy and export base, non-resource manufacturing garners little attention in BC.
• Non-resource manufacturing is very diverse, being comprised of many different industry segments. Some are heavily export oriented, while others are tilted more towards domestic (within-province) consumption.
• In 2014, the value of all non-resource manufacturing production (GDP) amounted to nearly $9 billion, equivalent to 4.4% of British Columbia’s real GDP.
• The sector currently employs 117,000 people across the province, many of whom earn above average wages. Of interest, employment in non-resource manufacturing is three times greater than in resource-related manufacturing.
• Non-resource manufacturing underwent a painful contraction during the 2008-09 recession and has yet to regain its pre-2008 level of output. The sector’s downturn in BC, however, was milder than in Ontario and Quebec.
• BC’s exports of non-resource manufactured products have increased significantly over the past decade and reached a new high in 2014. In light of this trend, as well as the weaker Canadian dollar, the sector looks well-positioned for ongoing export gains.
• Non-resource manufacturing has proportionally more mid-sized business establishments than the overall private sector economy. This reflects the fact that local manufacturers can take advantage of economies of scale by selling products into larger markets within Canada and abroad. It also speaks to the reality that manufacturing businesses are generally more capital-intensive than businesses in other industries.