Download SECTORAL OUTLOOK 2013-2015 CHAUDIÈRE

SECTORAL OUTLOOK 2013-2015
CHAUDIÈRE-APPALACHES
Fall 2013
Page |1
Author
Denis Gagnon, Economist
Service Canada
Chaudière-Appalaches Region
Telephone: 418-681-2599, ext. 2119; 1-866-299-5650
E-mail: [email protected]
Layout
Katalin Budai
Pictures
Modified picture, Denis Chabot, © Le Québec en images, CCDMD
Modified picture, Gilles M. Deschênes, © Le Québec en images, CCDMD
Modified picture, Martin Caron, © Le Québec en images, CCDMD
Cette publication est aussi disponible en français
This document summarizes analysis based on information available as of April 12, 2013. The views
expressed in this paper are those of the author and do not necessarily reflect those of Service Canada or
the Government of Canada.
© Her Majesty the Queen in Right of Canada
Page |2
TABLE OF CONTENTS
ACRONYMS ................................................................................................................................................. 3
LIST OF TABLES .......................................................................................................................................... 3
ABOUT THE SECTORAL OUTLOOK .......................................................................................................... 4
SUMMARY .................................................................................................................................................... 4
NOTES ON METHODOLOGY ...................................................................................................................... 7
EMPLOYMENT ESTIMATES ............................................................................................................................ 7
INDUSTRIAL GROUPS ................................................................................................................................... 7
PART 1: OVERVIEW .................................................................................................................................... 9
DESCRIPTION OF THE AREA.......................................................................................................................... 9
DEMOGRAPHY............................................................................................................................................. 9
ECONOMIC ENVIRONMENT ......................................................................................................................... 10
LABOUR MARKET INDICATORS .................................................................................................................... 13
PART 2: SECTORAL OUTLOOK ............................................................................................................... 14
INDUSTRIAL STRUCTURE ............................................................................................................................ 14
OUTLOOK ................................................................................................................................................. 15
PRIMARY SECTOR...................................................................................................................................... 16
CONSTRUCTION INDUSTRY......................................................................................................................... 18
MANUFACTURING SECTOR ......................................................................................................................... 19
CONSUMER-RELATED MANUFACTURING ...................................................................................................... 20
RESOURCE-RELATED MANUFACTURING ...................................................................................................... 22
INVESTMENT-RELATED MANUFACTURING .................................................................................................... 24
TERTIARY SECTOR .................................................................................................................................... 27
CONSUMER SERVICES ............................................................................................................................... 27
PRODUCTION SERVICES ............................................................................................................................. 29
PUBLIC AND PARAPUBLIC SERVICES............................................................................................................ 33
Page |3
Acronyms
AAFC ............... Agriculture and Agri-Food Canada
AAGR ............... Annual Average Growth Rate
CCQD ............... Conseil québécois du commerce de détail
CMA ................. Census Metropolitan Area
CRÉ .................. Conférence régionale des élus
CMHC............... Canada Mortgage and Housing Corporation
CCQ ................. Commission de la construction du Québec
COPS ............... Canadian Occupational Projection System
EDC .................. Export Development Canada
GDP.................. Gross Domestic Product
HRSDC............. Human Resources and Skills development Canada
ICT.................... Information and Communications Technologies
ISQ ................... Institut de la statistique du Québec
LFS................... Statistics Canada’s Labour Force Survey
MRC ................. Regional county municipalities
NAICS .............. North American Industry Classification System
OECD ............... Economic Co-operation and Development
R&D.................. Research and Development
List of Tables
Table 1 – Main Labour Market Indicators, 2010-2012
Table 2 – Breakdown of Employment for Selected Industry Groups
Table 3 – Employment Breakdown and Outlook in the Primary Sector
Table 4 – Employment Breakdown and Outlook in the Consumer-Related Manufacturing Sector
Table 5 – Employment Breakdown and Outlook in the Resource-Related Manufacturing Sector
Table 6 – Employment Breakdown and Outlook in the Investment-Related Manufacturing Sector
Table 7 – Employment Breakdown and Outlook in Consumer Services
Table 8 – Employment Breakdown and Outlook in Production Services
Table 9 – Employment Breakdown and Outlook in Public and Parapublic Services
Page |4
About the Sectoral Outlook
Each year, Service Canada issues medium-term employment forecasts both by industry and by
occupation for Quebec as a whole and for each of its economic regions. The results of these analyses are
published in the form of a series of studies intended to provide a comprehensive overview of recent
labour market developments and outlooks in Quebec and its various regions.
We hope this series of documents will interest people who are seeking labour market guidance and those
who help them, including parents, educational staff and employment assistance services workers. It
should also interest businesses and employer associations that want to identify human resources
management issues in their industries.
This document is composed of two sections. The first part provides a synopsis of the labour market in the
region, including an overview of economic developments and key labour market indicators. The second
part presents sectoral outlooks by industrial groups catalogued according to the North American Industry
Classification System (NAICS).
Summary
The Chaudière-Appalaches population, estimated at approximately 410,800 people in 2011, has
increased by 4.4% since 2006, to represent 5.2% of Québec’s entire population. Thus, the regional
population has undergone a slower growth than that of Québec (+4.7%) in the same period. In the
medium term, a slow population growth is expected, but the number of working-age people (15-64 years)
who constitute the vast majority of the workforce, will continue to decrease in the region, which will make
the arrival of young workers to the labour force insufficient to fill new positions and supplement all retiree
departures. The contraction of the potential labour force pool will help slow down employment growth and
economic activity.
In addition to immigration contribution, the retention and hiring of aging workers count as current
challenges that employers face to compensate the multiple departures to retirement. Finally, the majority
of labour force participants today will have to resign themselves to working longer to accumulate sufficient
retirement savings.
In step with the economic situation, the Chaudière-Appalaches’ industrial structure, over time, has
become centered on the development and processing of natural resources. However, since the early
2000s, the region has gone through many sectoral changes, which have transformed the economic
landscape. Today, the region distinguishes itself by a concentration of jobs in the primary and
manufacturing sectors, which have declined in the last decade, as well as by the construction industry,
which has taken off exponentially, and a less prevalent service sector, which has generated the majority
of new jobs.
The recent evolution of the labour market shows that activity levels and employment rose an average of
2.3% and 2.9% a year respectively, between 2009 and 2011. For its part, the unemployment rate,
estimated at 5.9% in 2009, dropped a percentage point in 2011 to 4.9%. In fact, the region posted its best
results in 2011 in terms of participation, employment and unemployment.
However, the labour market became more vulnerable in 2012. The number of employed persons has
decreased by 2.8% following the abolishment of 6,200 positions. At the industry level, the primary sector,
construction, investment-related manufacturing and production services have been the groupings most
affected by job losses. In the context of a gloomy labour market, the regional unemployment rate has
Page |5
dropped three tenths of a percentage point in 2012 to settle at 4.6% and remains the lowest of Québec’s
regions, due to a strong decline of the labour force (-3.1%).
Sectoral Outlook
For the 2013-2015 forecast period, employment growth will be an average of 0.8% a year in the region,
which will translate into the addition of close to 5,500 new positions, the main engines of growth being
investment-related manufacturing (+1.9%), as well as production services (+1.3%). In Québec, an
average growth of 0.9% is anticipated during this period.
Primary sector
By 2015, the primary sector will continue to lose ground with ongoing employment decline in agriculture,
which represents 80% of employment in the primary sector, despite the slight recovery in forestry. On the
other hand, the permanent closure of the Lac d'amiante du Canada mine in Thetford Mines has brought
another milestone in the history of the mining industry in Québec. Employment in the primary sector is
expected to decline by an average of 0.2% in the next three-year period.
Secondary sector
Chaudière-Appalaches is the second largest manufacturing region in Québec: manufacturing accounts for
20% of regional employment, compared with 12.5% in Québec. The contraction of manufacturing activity
since the early 2000s has directly impacted labour demands, and consequently, the number of people
working in plants. Between 2002 and 2010, manufacturing has shed 14,000 jobs, representing a net loss
of 25%. However, employment decline has ceased in 2011 thanks to the creation of 2,200 positions
(+5.3%) and 1,000 (+2.3%) in 2012. In the last couple of years, the region has thus recovered 23% of the
13,800 jobs lost in manufacturing between 2002 and 2010.
By 2015, the employment level will rebound thanks, in part, to the revival of the shipyard by ZM
Industries, which will proceed with the hiring of many hundreds of workers in the next few years, if all
goes according to plan. The revival of exportations has not yet taken place, but is expected in the medium
term. In the next few years, the region will thus build on the recovery of manufacturing, which will be
supported by the development of its niches of excellence (composite materials and plastic, wood siding
and technical textiles), as well as on value-added industries related to investments (metallic products,
machinery and transportation equipment) and in food processing. It is estimated that manufacturing
employment growth will be 1.0% per year during the 2013-2015 period, with investment-related industries
being responsible for more than 75% of the 1,300 new positions of the sector.
Following a strong increase that had been uninterrupted since the early 1990s, the construction industry’s
employment level slid in 2011 and 2012 owing to the downturn of residential construction. According to
our forecast scenario, it will be difficult to reach new highs in the next few years as a result of the
expected slowdown in residential construction, but the employment level will still undergo a slight
increase, an average of 0.2% a year, due to the momentum of the institutional and commercial sector, as
well as that of civil engineering and road work.
Tertiary sector
Much less dominant than in most other regions of Québec, services employ close to 147,000 people in
Chaudière-Appalaches, which corresponds to approximately 68% regional jobs compared with 79%
throughout Québec. This sector has known a solid performance in the last 10 years in the region, with the
employment level rising by an average of 1.7% a year between 2002 and 2012, despite a 3.3% decline in
2012.
Page |6
Since the early 2000s, services have taken over from the manufacturing sector, which has gone through
a transformation and diminished, allowing the regional economy to continue to create thousands of jobs.
This transition to an economy more based on consumption, services to individuals and companies, as
well as knowledge, has benefited many service groups. Moreover, there has been a strong growth of
production services, more specifically, business support services, and professional, scientific and
technical services. There are many reasons for this performance, namely the rapid development of and
accessibility to information technology, the rise of consulting engineering and architecture services, as
well as increasing outsourcing that aims to entrust external companies with responsibilities that were,
thus far, related to internal management functions.
After an increase averaging 1.7% a year in the last decade, the pace of employment growth (+0.9%) in
services is expected to dip by 2015, but it will still lead to the creation of approximately 4,200 positions,
with 40% of them in production services.
Page |7
Notes on methodology
Employment estimates
The employment estimates by industry are based on Statistics Canada’s Labour Force Survey (LFS),
because this tool is the only reliable source that follows employment developments in both Quebec and
the regions. Since the employment level in some industries is very low in a number of economic regions,
other sources of data – mainly of an administrative nature – have sometimes been used because LFS
figures in these industries are unreliable. In addition, three-year (2010-2011-2012) averages are included
in the statistical tables to provide a more reliable indication of employment levels. When the employment
level is below 1,500, the data is not published.
The employment outlooks have been established for a three-year period, from 2013 to 2015. They were
developed in winter 2013 in co-operation with Service Canada economists working in Quebec’s regions.
We also wish to thank the Canadian Occupational Projection System (COPS) team, without which we
would not have had access to many of the analysis and forecasting tools that were used to carry out this
study.
Industrial groups
The industrial analysis presented in this study is based on an aggregation using the North American
Industry Classification System (NAICS). Here, we provide a brief overview of the composition of each of
these groups. Precise definitions of the industries are available in the NAICS published by Statistics
Canada.
Primary sector
11 Agriculture, Forestry, Fishing and Hunting
21 Mining and Oil and Gas Extraction
Secondary Sector
23 Construction
31-33 Manufacturing
Tertiary Sector
22 Utilities
41-91 Service sector
When relevant, the following groups are also presented:
Consumer-related manufacturing
311 Food Manufacturing
312 Beverage and Tobacco Product Manufacturing
313 Textile Mills
314 Textile Product Mills
315 Clothing Manufacturing
316 Leather and Allied Product Manufacturing
Page |8
323 Printing and Related Support Activities
337 Furniture and Related Product Manufacturing
339 Miscellaneous Manufacturing
Resource-related manufacturing
321 Wood Product Manufacturing
322 Paper Manufacturing
324 Petroleum and Coal Products Manufacturing
327 Non-Metallic Mineral Product Manufacturing
331 Primary Metal Manufacturing
Investment-related manufacturing
325 Chemical Manufacturing
326 Plastics and Rubber Products Manufacturing
332 Fabricated Metal Product Manufacturing
333 Machinery Manufacturing
334 Computer and Electronic Product Manufacturing
335 Electrical Equipment, Appliance and Component Manufacturing
336 Transportation Equipment Manufacturing
Consumer services
44-45 Retail Trade
51 Information and Cultural Industries
71 Arts, Entertainment and Recreation
72 Accommodation and Food Services
81 Other Services (except Public Administration)
Production services
22 Utilities
41 Wholesale Trade
48-49 Transportation and Warehousing
52 Finance and Insurance
53 Real Estate and Rental and Leasing
54 Professional, Scientific and Technical Services
55 Management of Companies and Enterprises
56 Administrative and Support, Waste Management and Remediation Services
Public and parapublic services
61 Educational Services
62 Health Care and Social Assistance
91 Public Administration
Page |9
Part 1: Overview
Description of the area
Located south of the St. Lawrence River, across from Québec City, the Chaudière-Appalaches region,
which takes its name from the Chaudière River that crosses it south to north, as well as the Appalachian
mountain chain that makes up its southern part, is bordered by the Centre-du-Québec region to the west,
the Estrie region to the southwest, and Bas-Saint-Laurent and the US border to the east. Both urban and
rural, the region comprises 136 municipalities in 10 RCMs and equivalent territories, including the city of
Lévis, which accounts for one third of the Chaudière-Appalaches population.
Demography
Despite the fact that the demographic profile has improved, the decrease of the working age
population will progressively slow down the region’s employment growth and economic activity
Demography plays a key role in the development of the labour market and the region’s economic vitality,
leading to a series of overall, sectorial and professional impacts on labour supply and demand, and in
turn, on the demand for goods or services that explain, in great part, the economic growth.
Based on the last census, the Chaudière-Appalaches population, which has grown by 4.4% between
2006 and 2011, was approximately 410,800 people in 2011, representing 5.2% of the overall Québec
population. The regional population has thus increased a little slower than that of Québec (+4.7%). In fact,
the region’s numbers are modest: approximately 3,400 people were added each year between 2006 and
2011, an average increase of 0.9% annually. In the last 40 years, the regional population has evolved at
an average growth rate that is estimated at 0.7 % a year.
The growth of the Chaudière-Appalaches region’s population since 2006 has mostly taken place in the
urban centres of Lévis (+8,765 or 6.7%), Sainte-Marie (+1,305 or 11.3%) and Saint-Georges (+1,560 or
5.3%). The RCM of Lotbinière also stood out with an 8% increase. On the opposite end, there has been
setbacks in the most remote municipalities of urban centres, namely those in the RCM of L’Islet (-2%),
Montmagny (-1.4%), Les Etchemins (-2%) and Les Appalaches (-0.6%). In 2011, more than 46% of the
population lived in the 131 communities with less than 10,000 inhabitants, double that of Québec’s overall
population (23%).
The region’s demographic profile has improved in the last few years. Between 2006 and 2011, the
Chaudière-Appalaches region has recorded, on average, 1,700 more births than deaths, while this
difference was around 1,100 during the 2001-2005 period. This improvement in the natural increase is
due to an increase in the number of births that is three times more significant (+16%) that that of deaths
(+5%). In regards to inter-regional migration, the region presents overall positive results with an average
net gain (in-migrants minus out-migrants) of around 475 a year. In regards to international migration, net
migration, which has been barely positive (less than 100) since the mid-2000s, rose somewhat during the
last couple of years to settle at close to 200, with community responses to welcome immigrants beginning
to bear fruit. With regards to interprovincial migration, the region has always been recorded a deficit in the
last fifteen years, though, again, the situation improved, with net migration being practically nil in 20112012.
The Chaudière-Appalaches population is aging quickly, with the median age being around 43.4 years in
2012, while it was 35.9 years in 1996. In fact, seniors constitute the group with the fastest growth. Over
the last 15 years, the proportion of people over the age of 65 in the region has gone from 12% to close to
17% and that of the 0-19 age group, from 28% to 22%. Two factors explain the aging phenomenon. First
P a g e | 10
of all, there is a decline in fertility, which peaked in the early 1960s. Then, a longer life expectancy now
means that people born today will live at least one more decade than those born in 1950. According to
the Institut de la statistique du Québec (ISQ), the regional population will continue to rise slowly, by 0.4%
on average per year until 2021, compared to an average rate of 0.6% in Québec. The cohort aged 65 and
above will increase by 3.8% a year, while the number of people under the age of 25 will continue to
decline by -0.4% annually. Therefore, the number of younger workers arriving in the labour market will not
be sufficient to fill new positions and replace retirees. But just as significant as the aging phenomenon,
the number of people aged 15 to 64, who form the vast majority of the labour market, has already begun
to decrease in the region, at more than 1% in the last five years, while it is constantly rising throughout
Québec. This will have an impact on the demand for goods and services, and especially on labour force
availability.
In addition to the contribution of immigration, the retention and hiring of aging workers are some of the
current challenges facing employers to offset the many retirements. Given the fact that labour market
participation usually begins falling after age 55, companies will have to find ways to retain attract and
accommodate this important source of potential labour. Most people who are active today on the labour
market will also have to resign themselves to working longer to accumulate sufficient retirement savings.
Economic environment
The impacts of weak Québec demographics will intensify in the coming years
Quebec is the second most populous Canadian province. With an estimated 8,054,756 inhabitants as of
July 1, 2012, it represents approximately 23% of the Canadian population. This proportion has been
decreasing over more than 40 years because demographic growth in Quebec has been slower than in the
rest of Canada.
Immigration accounts for more than 60% of population growth in Quebec and the Institut de la statistique
du Québec (ISQ) expects that the natural growth rate will become negative by 2029. From that point on,
only a positive rate of immigration will ensure population growth. This may seem far off. However,
problems are already present in the labour markets of Quebec. Matching labour supply and demand has
never been easy in certain industries and professions and it will be even more so in a context where the
labour supply has decreased.
Demographics will increasingly slow the growth potential of Quebec over the next five years. The labour
markets will be affected by the increasing lack of new arrivals to make up for retirements and the needs of
a developing economy. According to our estimates, the dynamic of the population aged 15 years and
older will become negative around 2015-2016. For the group of people aged 20-64 years, the main
workforce of Quebec, the dynamic will not become negative until around 2018-2019.
The massive retirement of people from the labour market will result in the progressive loss of some tenths
of a percentage point from the unemployment rate each year. If nothing else happens to impede this
trend, the rate could even drop below 6% in 2016. Over the same period, there will be a slight drop in the
activity rate (from 64.9% in 2012 to 63.7% in 2016), while the employment rate should remain constant
around 60%.
Globalization has contributed to increased impacts related to various economic issues
Globalization has contributed to the growth of impacts related to economic issues. In a world where trade
and production are highly integrated, it is nearly impossible not to be affected by difficulties in another
economy.
That is why many international organizations have revised the world growth outlook downward for this
year. According to the International Monetary Fund (IMF) and the Organization for Economic
Co-Operation and Development (OECD), the “recovery” should come sometime after 2013. However,
P a g e | 11
growth will remain weak due to the impacts of reduced expenses in several governments and increased
caution on the part of companies and individuals.
Europe could recover from the recession in 2013, but it is more likely to happen in 2014. The significant
expense reduction measures have unsettled the labour markets. These markets have many growth
challenges and offer few opportunities to unemployed workers. Estimates say that economic and
employment growth will continue to be affected into 2020.
Emerging economies will continue to show high rates of growth over the coming years. However, this
growth will be less vital than in previous years. To counter the drop in business to external markets,
several countries have put mitigating strategies in place.
In the United States, the lack of a consensus on debt management caused some expense management
measures in the federal government to begin in the spring. If the entire mechanism is activated, it could
greatly curtail growth of the American gross domestic product (GDP), taking part of the growth of
Canadian and Quebec economies with it.
For now, the moderate growth of the American economy continues. The increased growth in 2013 has led
to a consensus among economists: 2014 looks promising. Already, an increase in construction starts in
the United States in recent years has been a positive sign for Quebec, particularly in terms of wood
product exports.
In Canada, according to the consolidation of forecasts from the main Canadian financial institutions
(February 2013), a growth in GDP of 1.8% in 2013 and 2.5% in 2014 is expected. Over the past few
years, a certain slowdown in the pace of growth has been seen due to the slow development of world
trade and the reduction in public administration expenses. Export Development Canada (EDC) expects
that the growth of exports will continue in 2013, except for exports to Europe.
Also according to the consolidated forecasts, over the next two years, employment growth in Canada will
be moderate, while the unemployment rate should remain around 7.2% in 2013 before decreasing as
business conditions improve around the world.
In Quebec, the consensus of the main Canadian financial institutions places GDP growth at 1.4% in 2013
and 2.0% in 2014. These outlooks are weaker than what Quebec has already seen. Some of the causes
include the decreased rate of growth in household expenditures, private investments that do not have as
much of a ripple effect as in the past, the slow growth of exports, and fiscal reorganization in the
governments.
As the growth potential of Quebec mainly hinges on improvements to external trade, we expect several
years of weak growth of both the economy and employment. Export forecasts from the EDC are positive
for the forestry sector, which should benefit from the improvement in residential construction in the United
States, and in consumer goods, also toward the United States. However, growth will be contained by the
slowdown in industrial goods.
Chaudière-Appalaches
The region has faced several sectoral changes since the early 2000s, which transformed the
economic landscape. The decline of the manufacturing sector, as well as the continuous
downward trend of the workforce within primary industries, contrast sharply with intense
activities in the construction industry and the tertiarization of the economy
In step with the economic situation, the Chaudière-Appalaches’ industrial structure, over time, has
become centered on the development and processing of natural resources. However, since the early
2000s, the region has faced several sectoral changes which have transformed the economic landscape.
The decline of the manufacturing sector, as well as the continuous downward trend of the workforce
within primary industries, contrasts sharply with intense activities in the construction industry and the
tertiarization of the economy. In addition to a rather modest employment growth in the last decade, other
indicators show a more or less rosy picture of the region compared to the province overall. These include
P a g e | 12
output, capital investments, disposable income, labour productivity and deliveries outside of Québec for
which the region is below the provincial average.
1
According to the ISQ , after slipping in 2009 (-2.9%), the gross domestic product (GDP) at basic prices
rose in 2010 (+3.3%) and continued its climb (+4.2%) in 2011 to reach $13.4 billion, which corresponds to
4.3% of Québec’s production, a relatively lower weight than that of its population (5.1%) and its
employment level (5.6%). In fact, since 2008, the regional GDP has increased by an average of 1.5% a
year in comparison to 3.1% throughout Québec. The Chaudière-Appalaches region ranked 5th among
th
Québec’s 17 regions as per the GDP value in 2011, but ranked 16 in terms of growth between 2008 and
2011.
Capital expenditures, which averaged nearly $3 billion in the region during the 2008-2012 period (4.6% of
investments in Québec), have increased by 23.2% from the five previous years (2003-2007), while a
27.1% increase was observed in Québec. In total, investments in machinery and equipment, which
represented 30.1% of capital assets, have dropped by 17.2% during this period as opposed to a 4.1%
increase in Québec. Meanwhile, average investments per job were estimated at approximately $13,880 a
year during the last five years compared to $16,334 in Québec, representing a shortfall of close to 15%
th
under the Québec average. The latter numbers, which place the Chaudière-Appalaches region in 14
position of Québec’s regions, suggest that the regional economy is much less reliant on capital than the
Québec average, while confirming chronically low investments.
Household disposable income was estimated at $24,444 in the region in 2011, according to the ISQ, a
1.7% increase from 2010, but one that is inferior to the province’s 4.7% average ($25,646). With a distinct
th
disadvantage, the Chaudière-Appalaches region ranks 11 among Québec’s regions.
Labour productivity is a key indicator of long-term economic prosperity. The GDP per job, an
approximation of labour productivity, was $60,585 in 2011 in Chaudière-Appalaches compared with
th
$79,422 in Québec as a whole, a difference of about 23% with the province. The region ranked only 13
among Québec’s regions in terms of productivity. Characterized by an industrial structure dominated by
numerous small establishments, the region may find it difficult to leverage economies of scale and to
keep up with technological progress at the same speed as regions where the presence of major
companies is more significant.
Out of the 1,300 manufacturing companies counted in 2010 in the region, 28% sold their products abroad
and 34% throughout the rest of Canada (excluding Québec). For comparison purposes, throughout all of
Québec’s regions, the proportion of companies that supply their products to international markets is
estimated at 20% and 24% export to other Canadian provinces. The regional manufacturers’ share of
international exports reached only 18% of their total value of sales versus 35% in Québec. The proportion
of revenues from sales in the rest of Canada was estimated at 20%, a proportion similar to that of
Québec. Finally, though the region has a significant number of manufacturers who sell outside Québec,
the proportion of their deliveries outside Québec is relatively low, at 38%, compared with 55% in Québec.
Lastly, the performance of the regional economy is closely linked to the vigor of its main economic
centres, namely Lévis, Sainte-Marie and Saint-Georges, that pull the region upward, thanks to a strong
contribution of the private sector. Previously embryonic industries, which arose from productive niches
and the new economy, have gained speed and helped to transform the regional economy over the years.
And, to the exception of clothing manufacturing, which has been greatly impacted by competition from
emerging countries, this has taken place without writing off traditional industries from the map, such as
food processing and the forestry sector, which must be more innovative and productive to remain
competitive and ensure their survival. What is at stake is the harmony between the territory’s rural areas,
where the economic engine is, historically, the development and the primary processing of natural
resources, and urban centres, where the economy is more based on greater value-added activities and a
wide range of services.
1
In this section, regional data on gross domestic product, disposable income, capital expenditures and the shipment of
manufactured goods are taken from the website on Region and RCM Profiles of l’Institut statistique du Québec (ISQ) at the
following address: http://www.stat.gouv.qc.ca/regions/profils/region_00/region_00_an.htm
P a g e | 13
Labour market indicators
The year 2012 will not be seen as historical for the regional labour market, which shifted from
an upturn to gloomier times. After a solid performance in 2010 and 2011, the regional labour
market has recorded a strong decline of participation in 2012, coupled with a loss of more than
6,000 jobs
The performance of the Chaudière-Appalaches region in terms of employment growth was below the
provincial average over the last ten years, with a yearly rate of 0.8% compared with 1.1% throughout all
of Québec. It has thus ranked 10th among Québec’s regions. After a period of uncertainty between 2004
and 2009, the labour market has enjoyed a remarkable recovery, which has brought about a surge in
activity, the creation of many more thousands of jobs and a sharp drop in unemployment in 2010 and
2011. The level of activity and the number of employed rose by 2.3% and 2.9%, respectively, on average
per year, between 2009 and 2011. For its part, the unemployment rate, estimated at 5.9% in 2009, fell by
one percentage point, to 4.9%, in 2011. In fact, the region even set new records in 2011 with regards to
the activity, employment and unemployment rates, and has even ranked first among Québec’s 17
economic regions. The regional economy has thus shown a remarkable recovery in the wake of the last
recession, thanks mainly to the service sector and the construction industry, which more than
compensated for problems in the manufacturing sector.
The year 2012 will not be seen as historical for the regional labour market, which shifted from an upturn to
gloomier times following a decline in participation and employment. Indeed, employment has fallen by
2.8% following the abolition of 6,200 positions. The main industries that posted a decline are agriculture,
construction, retail trade, finance, insurance, real estate and leasing, professional, scientific and technical
services, as well as public administrations. In contrast, the other industries of the primary sector (forestry,
fishing, mines and oil and gas extraction, excluding agriculture), manufacturing, education, health and
social assistance and other services have benefited from a rise in employment. In this somewhat volatile
labour market context, the regional unemployment rate has dropped three tenths of a point in 2012 to
settle at 4.6% and remains the slowest of Québec’s regions despite a strong decline of the labour force (3.1%).
Table 1 – Main Labour Market Indicators, 2010-2012
Population 15+ ('000)
331.9
333.4
333.5
Annual
Average
333.6
Labour force ('000)
224.8
231.0
223.9
227.4
Employed ('000)
215.4
219.8
213.6
216.3
Chaudière-Appalaches Region
Unemployed ('000)
Participation rate
Unemployment rate
Employment rate
2010
2011
2012
11.9
11.2
10.3
11.1
68.5%
69.3%
66.7%
68.2%
5.2%
4.8%
4.6%
4.9%
64.9%
65.9%
63.7%
64.8%
Source: Statistics Canada, Labour Force Survey, unadjusted for seasonality
Data compiled by Service Canada
P a g e | 14
Part 2: Sectoral Outlook
Industrial structure
The Chaudière-Appalaches region is characterized, first, by its concentration of jobs in the
primary and manufacturing sectors, which have declined in the last decade, as well as by the
construction industry which has taken off exponentially, and a service sector that is less
dominant than anywhere else, but which has generated the majority of new jobs during this
period
The Chaudière-Appalaches region employed an average of 216,300 people during the 2010-2012 period,
or 5.5% of working individuals in Québec. The total number of jobs has increased by 13.1% in the region
in the last decade (from 2000-2002 to 2010-2012), resulting in the net creation of close to 25,000
positions, compared to an increase of 13.9% in Québec where approximately 482,000 new positions were
added.
In 2010-2012, the primary and secondary sectors accounted for nearly 32% of regional employment, or
approximately 70,000 positions, the second highest proportion among Québec’s regions, which however
has slipped 6 percentage points since the early 2000s. On the opposite end, the proportion of jobs in the
service sector has progressed by over 6 points, from 61.6 % in 2000-2002 to 67.9% in 2010-2012.
Despite that, the relative share of the service sector is still much below that of Québec as a whole, which
counts for 79.2% of all jobs in this sector. In other words, while employment was increasing by 24% in the
services sector during the last decade, the other two sectors recorded losses of 4.6%.
The primary industries accounted for approximately 10,000 jobs in the region in 2010-2012, which
represents 4.6% of total employment in Chaudière-Appalaches, in comparison to 2.2% in Québec. This
relative share rose to 6.1% nearly a dozen years ago in the region while it was estimated at 2.9% in
Québec in 2000-2002, for all segments (agriculture, forestry and mining) resulting in employment losses
during this period. Close to 85% of primary employment is concentrated in agriculture.
In the last decade, the manufacturing sector has declined substantially in Chaudière-Appalaches, but a bit
less than in Québec. The number of jobs has also fallen, from 51,600 in 2000-2002 to 43,100 in 20102012, a net loss of 16.5% compared to the 22.1% decline across Québec. The manufacturing sector
accounted for 19.9% of regional employment, whereas this proportion was 12.5% throughout Québec
during the last three years. In comparison, this proportion rose to 27% in 2000-2002 (and 18.3% in
Québec).
For its part, the construction industry has shown unprecedented vigour in the last decade, which
translated into solid employment growth. Since the early 2000s, the employment level in construction has
jumped 75% in Chaudière-Appalaches, resulting in a workforce of 16,300, or 7.6% of regional jobs
compared to 6.0% in Québec.
The service sector, however, is far less dominant in Chaudière-Appalaches. Approximately 146,000
people work in the region’s service sector, who account for 68% of workers compared to a proportion of
above 79% throughout Québec. However, the number of employees in this sector has grown
considerably in the region, from 117,700 during the 2000-2002 period to 146,300 during that of 20102012, resulting in the addition of 28,600 positions, which corresponds to an increase of 24.3% versus a
21% increase in Québec.
P a g e | 15
Outlook
After a gloomy period for the employment market in 2012, gradual clearing is forecast by 2015.
Employment growth, while moderate, will come from both a recovery in manufacturing, which
was confirmed in 2012, and the continuing tertiarization of the industrial structure
Although subject to high volatility that could cause fluctuations at the regional level, even surprising ones
at times, labour market indicators are one of the conventional tools used to measure the performance of
the regional economy. They are used to show a region’s ability to generate jobs and fill vacant positions.
After a sluggish 2012 marked by weak economic conditions which were then followed by two years of
expansion, our forecasts show a moderate rise in regional employment by 2015. This increase will
average 0.8% a year, leading to the creation of close to 5,500 new positions in the next three years. In
comparison, in Québec, an average employment increase of 0.9% is expected during this period to close
off the forecast period with the creation of 114,400 jobs. The region will thus supply 4.8% of all positions
created throughout Québec while it represents 5.5% of overall employment.
Following its recovery in 2011, which was confirmed in 2012, the manufacturing sector will continue to
build on its momentum during the three-year period, with an average growth of 1.0% a year, which will
result in the addition of close to 1,300 positions. Investment-related manufacturing will be this growth’s
main driving force, concentrating three quarters of all new manufacturing jobs. The large service sector,
the largest employer, will be responsible for 77% of jobs created by 2015, with the addition of more than
4,200 new positions, a number well above the 1,700 jobs in production services.
After a sharp nose dive in the last couple of years, employment in the construction industry will return to
an upward trend, but at a much slower rate, at an average increase of only 0.2% a year. Outlooks for the
primary sector are still calling for a marginal decline in employment, generated by agriculture and mining.
Lastly, in a context of fierce competition and scarcity of labour, employers who wish to ensure their
survival and grow will have to be more creative in the management of their human resources, notably in
recruitment, employee retention and talent development since the key to success lies in their employees’
involvement and commitment to the enterprise.
Table 2 – Breakdown of Employment for Selected Industry Groups
Average for 2010–2012
Chaudière-Appalaches Region
Level
thousands
Region
All Industries
216.3
Share of
Employment
Region
100.0%
Province
2013–2015
Annual Average
Growth Rate
Region
Province
100.0%
0.8%
0.9%
Primary
10.0
4.6%
2.2%
-0.2%
0.5%
Manufacturing
43.1
19.9%
12.5%
1.0%
0.6%
Construction
16.3
7.6%
6.0%
0.1%
0.6%
Services
146.8
67.9%
79.2%
0.9%
1.0%
Consumer services
51.0
23.6%
27.2%
0.8%
1.0%
Production services
45.9
21.2%
26.0%
1.3%
1.3%
Public and parapublic services
49.9
23.1%
26.0%
0.8%
0.9%
Source: Service Canada, Quebec Region
Historical estimates based on Statistics Canada’s Labour Force Survey
P a g e | 16
Primary sector
The sector is dominated by agriculture, which holds the monopoly on 85% of its workers and
which makes Chaudière-Appalaches the second agricultural region of Québec, with 15% of the
labour force and production focused on the Québec industry
The primary sector continues to play a leading economic role in the region. With 11% of jobs in Québec,
the region accounts for 10,000 workers in the primary sector, a proportion that is double that of the entire
province, at 4.6% compared to 2.2% in Québec. The regional GDP was estimated at close to $650 million
in 2010, or 5.1% of the overall GDP, and 8% of the industry in Québec. Employment trends show a
decrease since the mid-1990s, despite surges from one year to the next. In the last decade, employment
decreased at an average of 1.5% a year in the region, compared to a decline of 0.3% in Québec.
Employment growth depends on the state of agriculture, which accounts for 85% of sector workers and
has seen its employment level decline by 1.1% a year since 2002. Although primary production has
increased slightly in the last few years, the level of employment has not kept this trend, due to higher
productivity gains. Our forecast scenario is based on a slight decline in employment in the range of 0.2%
a year by 2015, given the continuously slow decline of employment in its main link, agriculture, coupled
with the abandonment of the project to restart the Lac d’amiante of Canada mine and a slight recovery of
the forest industry due to the improvement of the housing sector in the United States.
Table 3 – Employment Breakdown and Outlook in the Primary Sector
Average for 2010–2012
Chaudière-Appalaches Region
Level
thousands
Region
Primary Sector
Agriculture
Share of
Employment
Region
Province
2013–2015
Annual Average
Growth Rate
Region
Province
10.0
4.6%
2.2%
-0.2%
0.5%
8.4
3.9%
1.4%
-0.3%
-0.2%
Source: Service Canada, Quebec Region
Historical estimates based on Statistics Canada’s Labour Force Survey
Agriculture: crop production, animal production and aquaculture
Second largest in Québec, the agricultural industry has 5,800 farms in Chaudière-Appalaches.
Employment is estimated at 8,400, or close to 4% of regional employment and 15% of Québec’s
agricultural workers. Changing economic conditions have led producers to consolidate their activities, so
much so that there has been a reduction in the number of farms and a growth in the size of
establishments for several years. Farmland in the region corresponds to about 20% of all Québec
farmland. Dairy and hog production remain the center of the regional industry and are at the top of the list
with regards to cash receipts. However, there has been a shift from livestock production to crop farming in
the regional industry. Over time, the industry has also diversified with several producers choosing to bank
on less conventional livestock breeding, such as rabbits, goats, horses, bisons, boars, ducks and quails.
Growth has also been observed in organic farming, particularly the maple syrup, field crops, horticulture
and dairy production sectors. While production, sales and capital investments have all gone up in recent
years, the industry posted a decline in employment, at an average of 1.1% a year between 2002 and
2012.
The rising demand for agricultural products should remain strong in the medium term, both on the internal
market as overseas. Succession problems, especially among farmers, whose average age was 51 in
2001, persist and are worsening. Clearly, attracting new farmers into agriculture and ensuring the transfer
of farms to the next generation of producers make up some of the challenges the industry must face
today. Furthermore, as the demand for seasonal workers is still high, producers are increasingly turning
to foreign labour. The sale of local and home-grown products directly to consumers through booths, pickyour-own operations and public markets is an appealing alternative to overcome, in part, difficulties in
P a g e | 17
product marketing and accessing grocery shelves which are due to market and distribution channel
fragmentation. Local farming, the development of alternative crops and livestock, organic farming, agritourism and home-grown products are becoming more and more widespread; however, it has had very
little impact on employment. Incidentally, the Québec government is close to adopting a food sovereignty
policy, which will prioritize local production to feed the population, as well as returning the access to farm
lands and resources required to do this, while giving the sector the opportunity to take advantage of
external markets. Lastly, the growth of international trade and the globalization of markets – notably within
the context of WTO negotiations and trade agreements such as the trans-Pacific partnership and the free
trade agreement with Europe – worry producers, particularly with regards to the lowering of trade barriers
and the supply management system. In the coming years, the production and sale of agricultural products
will continue to increase, but productivity gains will cancel out employment growth. Regional employment
should therefore continue to decline at an average of 0.3% a year until 2015.
Forestry and logging
The forestry industry employs less than 1,500 workers in Chaudière-Appalaches. However, the forestry
sector yields substantial benefits for several of the region’s rural municipalities. For several years now, the
Québec industry has been faced with critical challenges following the decline of the main capital markets.
The region has not been spared by this crisis, with the industry losing an average of 2.3% of jobs a year
between 2002 and 2012, a decrease that is still less than across Québec (-6.2%). This is explained by a
lesser dependence of the region on reduced stumpage dues on Crown lands given the presence of close
to 20,000 private woodlot owners, more than one quarter of owners in Québec. These owners harvest
more than 80% of all timber harvest volumes of the regional territory. By contrast, the government’s
announcement last February to cut silviculture development programs of private forests (-15%) may
threaten the aforementioned industry. But, this announcement was followed by an agreement between
the provincial and federal governments, targeting a $24 million investment to fund silvicultural work in
forests, as well as the rehabilitation of water crossings on wildlife roads. Furthermore, the government of
Québec has reaffirmed its intent to pursue its efforts to promote the use of wood in construction by
drawing up a charter calling for the use of wood, while affirming the need to examine the use of this sort
of material for publicly funded projects. In addition, enhancing the investment tax credit will also support
the forest sector. Finally, the new Sustainable Forest Development Act, in effect since April 2013,
provides for the establishment of an open, auction-type market for a significant percentage of public forest
lumber, which translates into, according to the government, a growth of harvested timber, as well as the
auctioning of part of the wood available on Crown lands. This is a cause of concern for some producers.
In this context, it is believed that positive factors will prevail over stumbling blocks, leading to weak
employment growth over the next three years, at an average rate of 0.5 % a year, which is also in line
with the industry’s recovery forecast of lumber product manufacturing and an improvement of the U.S.
housing market.
Mining, quarrying, and oil and gas extraction
The region’s mining industry, carried until recently by asbestos operations, has suffered greatly from the
closure of several deposits and a steady decrease in the number of jobs throughout the last decades. The
abandonment of the project to restart the last asbestos mine, namely the Lac d’amiante du Canada, in the
fall of 2012, has marked the end of the extraction of this mineral in the region. The regional mining sector
essentially relies today on the mining of various non-metallic minerals that primarily serve the construction
industry, where activities will be rather stable in the next few years. Mining investments in the region
2
accounted only for 0.05% of the $4.8 billion injected across Québec in 2012 . The industry’s employment
will continue a downward trend into 2015.
2
Institut de la statistique du Québec, « Relevé des dépenses d’exploration minière, de mise en valeur et d’aménagement des
complexes miniers », Graph of the Distribution of mining investment by Québec administrative region, 2012 », [Online],
http://www.stat.gouv.qc.ca/donstat/econm_finnc/sectr_mines/invest_ra_an.htm.
P a g e | 18
Construction industry
The construction industry, which ended a 12-year expansion cycle in 2010,
has embarked on a more peaceful era
In Chaudière-Appalaches, the construction industry is a major business segment that serves as a
barometer for regional economy. According to ISQ estimates, the region’s companies have spent more
3
than $2.3 billion in construction assets in 2012, with half of them stemming from the housing segment.
The GDP of the construction industry was estimated at $905 million in 2010, which represented 7% of
regional production. Furthermore, construction generates some 16,300 direct jobs, or 1 job out of 13 in
Chaudière-Appalaches. No need to explain that it also calls upon the contribution of many players, such
as architecture and engineering firms, material suppliers, workers and contractors and sub-contractors.
Fuelled by favorable economic conditions, the number of building contractors has increased by nearly 7%
between 2000 and 2010 to reach close to 1,900 establishments, while the volume of workers has jumped
by 105% during this period to settle at approximately 18,000 in 2010. However, after reaching a peak in
2010, the employment level suffered a setback in 2011, and in 2012, of nearly 20%. On another
disappointing note: the value of building permits issued by the region’s municipalities, which has reached
nearly $718 million in 2012, with two-thirds allocated to the residential component, has declined by 12.5%
compared to 2011 and in all components. This was only the third decrease of construction intentions
since 1999. In contrast, they increased again by 3.5% in Québec as a whole for the third year in a row.
In the housing sector, mortgage rates, the housing supply, the demographic profile and household
formation remain positive in the region. However, the latest mortgage restriction measures of the federal
government seem to have reached their goal, to slow down the fervour of households, whose debts have
increased in recent years. These measures have also reduced, to some extent, potential owners’ ability to
acquire a residence, with the market segment of first-time homebuyers being directly affected by these
changes. One can observe the diversification of housing supply to condominiums based on demand from
new residents and young families, as well as the changing needs of an aging population. There are still
many large-scale real estate projects that will maintain high activity and employment levels in Lévis and in
other urban centres of the territory. In the renovation segment, the strength of the resale market, as well
as the aging real estate inventory and population, should maintain intense activity and continue to
generate a good portion of residential investments. In sum, new market conditions will provoke a certain
slowdown of residential construction in the next few years, which will lead to a more balanced market.
Non-residential construction will be supported by the commercial segment, which is still booming in the
region. The vacancy rate in office buildings remains below average, with demand for new retail spaces
and offices remaining steady. Expansion of the Centre des congrès et d’exposition de Lévis and
construction of a 24-stories tower near the Four Points by Sheraton convention centre and hotel, the
large-scale commercial and residential Carrefour Saint-Romuald project scheduled near the bridgeheads,
ongoing work on the new Cité Desjardins, as well as the implementation of the L’Innoparc technological
park are among the main projects. Added to those are major public and parapublic institutional projects,
such as for example, the expansion and redevelopment of l’Hôtel-Dieu de Lévis, as well as the
implementation project of the regional cancer centre, the renovation and expansion of the Montmagny
courthouse, the construction of a new arena in the Saint-Romuald neighbourhood and the revitalization of
Lévis’ ferry area.
Significant sums will be invested into public infrastructure in the coming years. During the tabling of the
provincial budget 2013-2014, the Government announced its plans to make a significant shift to bring
investments in public facilities back unto a path compatible to its ability to pay. The level of capital
investments has been established at a $9.5 billion maximum on average for the next five years, a
reduction of $1.5 billion compared to the levels anticipated in the 2012-2013 budget. The new Plan
québécois des infrastructures 2013-2023, presented in April 2013, proposes investments of $92.3 billion
over 10 years, to renew and improve public infrastructure. To these investments are added $4.5 billion in
contributions from the federal government and other partners, mainly municipalities, who will invest $9
3
Institut de la statistique du Québec, Capital and repair expenditures by NAICS sector and subsector, Chaudière-Appalaches,
1998-2012, 2012 », [Online], http://www.stat.gouv.qc.ca/regions/profils/profil12/econo_fin/conj_econo/investis/ipp_reg_12_an.htm
P a g e | 19
billion. Moreover, the Québec government will inject $654.5 million in Chaudière-Appalaches during the
2013-2015 period as highway investments, with the region receiving more than 11% of investment totals
in Québec’s road network. The main projects selected include the extension of Highway 73 in the Beauce
region and the construction of Highway 112 in Saint-Joseph-de-Coleraine and Thetford Mines. Finally, by
2015, the main municipalities plan on investing several hundred million dollars as part of their three-year
capital investment program, with more than $500 million in Lévis.
In the energy segment, large-scale projects were recently achieved, such as the planning of the Massifdu-sud wind farm ($370 million), the construction of a pipeline between Québec City and Montreal by
Ultramar ($350 million) and the extension of the pipeline between Vallée-Jonction and Thetford Mines by
Gaz Métro ($18 million). On the other hand, work on the Des Moulins wind farm ($400 million) and the
Sartigan dam ($22.5 million) will continue, but should be completed by the fall of 2013, while the Mont
Frampton community wind power project, with construction costs estimated at $72 million, is proceeding
as planned, to be completed in 2015.
Representing only 7% of the value of building permits in 2011, the industrial component has accounted
for more than a quarter of decline in the value of building permits issued by the region’s municipalities in
2012. Due to the sluggishness of industrial investment, this component will have very little impact on
employment growth in the region’s construction industry by 2015.
In short, the regional construction industry, which ended its boom cycle spread over a dozen years (1999
to 2010), suffered losses in 2011 and in 2012, due to a decrease of construction investment intentions.
Our forecasts show that the decline occurring in the last couple of years will revert to a slight growth that
will continue until 2015, due to a high volume of activity in the non-residential sector, which will make up
for the decline in residential construction. We believe that positive forces will have a bit more influence on
the industry’s workforce numbers, which will increase by an average of 0.2% a year until 2015.
Manufacturing sector
After losing one quarter of its workforce between 2002 and 2010, the manufacturing sector
made a recovery in 2011, which was confirmed in 2012. In the medium term, the
manufacturing sector will be affected by both Québec and Canada’s tumultuous economic
situations, but at the same, revitalized by a vibrant global economy, particularly in the United
States, which will allow for a rise in its exports
The manufacturing sector approximately 43,000 workers in Chaudière-Appalaches, representing 20% of
regional employment, compared to less than 13% in Québec. The Chaudière-Appalaches region is
Québec’s third manufacturing region in absolute employment terms and second for the proportion of jobs.
This sector is diversified, but some industries stand out, notably those that manufacture wood products,
food and beverages, metallic products, furniture, rubber and plastic products, machinery and
transportation equipment.
The manufacturing sector has undergone some major changes, brought about especially by exchange
rate fluctuations, stiffer international competition and a slower growth of its main export market, namely
the United States. These factors have led to a decline in production, deliveries and exportations, as well
as lower competitiveness between companies during the 2000s. While the share of the manufacturing
GDP corresponded with more than 30% of the overall regional production in 2007, this proportion
declined to less than 23% in 2010. On the other hand, between 2002 and 2010, the sector suffered close
to 14,000 job losses (-25%), and the share of employment in regional manufacturing dropped from 27%
to 21% during this period. However, the sector has made a solid recovery since the end of the recession.
The tide of job losses was thus stemmed as of 2011, with the addition of 2,200 jobs (+5.3%) in 2011 and
1,000 jobs (+2.3%) in 2012. In the last couple of years, the region recovered 23% of 13,800 jobs lost in
manufacturing during the 2002-2010 period. On the other hand, regional manufacturing production
declined by 25% in the region between 2007 and 2010.
P a g e | 20
In order to grow, companies will have to innovate to improve their competitiveness, by reorganizing, for
example, the production chain by targeting more productivity, by developing new products or by entering
new markets. The sector’s progression may also go through the integration of service offers that are
complimentary to traditional manufacturing activities. Hence, as stated by the Conference Board of
Canada: “SMEs should begin planning and adopting a series of measures to allow them to develop
4
optimal that will complement well their product offerings” (original text only available in French) . And
among these services, one can find “the procurement of components from third parties and the
integration of said components into manufactured products to obtain a wider range of products; testing
and quality control; finished goods inventory management, as well as transportation and logistics for end
users; installation; training; maintenance; and product recycling at the end of the life cycle. Other services
also include participation to the product development process, notably at the design stage, based on
5
client requirements or for manufacturing itself” (original text only available in French) . In addition, local
stakeholders focus on the development of niches of excellence, such as composite materials and
plastics, wood siding, and technical textiles, to ensure the growth of economic activity and the region’s
wealth, by making light of its distinctive strengths.
In the medium term, the manufacturing sector will be affected by both Québec and Canada’s tumultuous
economic situations, but at the same, revitalized by a vibrant global economy, in particular that of the
United States, which allow for rising exports. However, this assumption must be cautiously optimistic. By
2015, the sector’s growth is expected to be seen as a clearing, with an annual increase of 1.0% in
employment, higher than that forecast for Québec as a whole (+0.6%). All groups will contribute to this
progression, but investment-related manufacturing will be its driving force, thanks in large part to the
reopening of the Davie shipyard.
Consumer-related manufacturing
Food and beverage manufacturing, the main consumer-related manufacturing industry, is a
major economic driver of the region, thanks to the presence of major processors and smaller
manufacturers who operate in the crafts and land niche markets
Table 4 – Employment Breakdown and Outlook in the Consumer-Related Manufacturing Sector
Average for 2010–2012
Chaudière-Appalaches Region
Level
thousands
Region
Whole Manufacturing Sector
Consumer-Related Manufacturing
Share of
Employment
Region
Province
2013–2015
Annual Average
Growth Rate
Region
Province
43.1
15.1
19.9%
7.0%
12.5%
4.5%
1.0%
0.2%
0.6%
0.1%
Food, Beverages and Tobacco
6.3
2.9%
2.0%
0.6%
0.6%
Printing and Related Activities
2.0
0.9%
0.5%
-0.2%
0.2%
Furniture and Related Products
4.4
2.0%
0.7%
0.1%
0.2%
Source: Service Canada, Quebec Region
Historical estimates based on Statistics Canada’s Labour Force Survey
In the region, consumer-related manufacturing industries employ 15,000 people, representing 7% of
regional employment. Approximately 70% of jobs are concentrated in food and beverage manufacturing,
as well as furniture manufacturing. This sector includes industries whose growth depends greatly on
4
Conference Board of Canada, « Les PME manufacturières au Québec : ajouter des services pour améliorer la compétitivité et les
résultats financiers- Rapport Mars 2012» by Samuel Suss, Michelle Thomson, Vincent Thomson and Michael Bloom, p. 25.
5
Ibid., p.24.
P a g e | 21
consumer spending that has been the source of growing economic activity in the last decade. Despite
that, employment levels have strongly declined in the region: between 2002 and 2010, the sector lost
approximately 10,000 positions, particularly in the clothing, textile, furniture and miscellaneous
manufacturing industries. During this period, these industries were impacted by the rise in the Canadian
dollar, growing competition from emerging economies, in addition to the recession of the late 2000s. But
after the recession, employment stabilized. In the short term, a slight increase in consumption, coupled
with stronger business confidence and recovery of demand from the United States, should allow the
sector’s employment levels to somewhat rise. By 2015, the consumer-related manufacturing sector will
embark on a very slight upward trend in the region, at an annual average rate of 0.2%. Food and
beverage manufacturing will be the biggest job creator, while the clothing, printing and miscellaneous
manufacturing industries will suffer losses.
Food, beverage and tobacco product manufacturing
The food and beverage manufacturing industry is a major economic driver of the region thanks to the
presence of major food processors on the territory, such as Olymel, Exceldor, Saputo, Frito Lay, Maple
Leaf Foods, Agropur, Boulangerie St-Méthode and Multi-Marques. Listed as the second manufacturing
industry in terms of employment in the region, food processing, which includes more than 120
establishments of all sizes, employs approximately 6,300 and relies on a throng of small businesses that
manufacture specialty, craft and land products, with demand rapidly growing. The industry represents
close to 15% of manufacturing jobs in the region and approximately 8% of them in the Québec industry as
a whole. Despite the highs and lows, employment has decreased slightly in the last decade, at 0.5% a
year between 2002 and 2012. A continued growth in investments over the last few years has led to an
increase in productivity, while eliminating employment growth. In the next few years, the regional industry
will be affected by the closure of the J.M. Smucker’s Canada plant in Sainte-Marie in the summer of 2013,
leading to the loss about 100 positions. Despite this closure, the employment level in the industry is
expected to post an average growth of 0.6% a year by 2015.
Clothing manufacturing and Leather and allied product manufacturing
and
Textile mills and textile product mills
The textile and clothing industries, which together employed 8,000 at the end of the 1990s, accounted for
approximately 15% of manufacturing jobs. Many companies did not manage to survive the stiff
competition from emerging countries, especially since the majority of these companies were specialized
in the outsourcing of manufacturing, a segment of the industry which has been the most severely affected
by the offshoring of jobs to these countries. Our forecasts are calling for a continuous decline of
employment in manufacturing, which has lost many key companies over the years. For its part, the textile
industry geared toward technical fabrics and a higher value-added production should be able to curb job
losses by 2015.
Printing and related activities
For the past five years, the workforce of the printing industry, now estimated at approximately 2,000
workers, has significantly trended downward, dropping by 6.4% a year. In addition to the inevitable
movement of transition from printing to digital, an overcapacity of production, the consolidation and
restructuring of big corporations, foreign competition and lastly, the last recession, have aggravated the
difficulties. During this period, a significant number of small and medium-sized printers have closed.
Technological evolution transforms customers’ habits in the way they get informed and the way they
entertain themselves, by favoring electronic content at the expense of prints. The growing popularity of
digital media and notebooks will lead to printing media losing more ground. Printers are also facing
foreign competition, notably from emerging countries who mass produce at a lower cost and who acquire
market shares in traditional printing. Industry investments were directed towards the acquisition of higher-
P a g e | 22
performing equipment, ensuring increased productivity at the expense of job creation. By 2015, the
printing industry will once again record a slight employment decline, at an average of 0.2% a year.
Furniture and related product manufacturing
Although severely devastated, since 2002, by decreases in production and deliveries that have led to
closures and layoffs, furniture manufacturing remains an important industry in the region, with more than
150 establishments and 4,400 workers. The regional industry holds 10% of jobs in the manufacturing
sector and 16% of jobs in the Québec furniture industry. By contrast, the regional industry lost some
3,400 jobs (-42%) in the last decade, which represents more than 20% of 15,500 positions lost within the
Québec industry. During this period, the industry has faced one challenge after another, such as the rise
of the Canadian dollar and growing pressure from Asian competition, which culminated in the last
recession. Furniture manufacturers have had to adjust their production to more value-added products and
review their business model to face competition by focusing, among other things, on reducing delivery
deadlines. Manufacturers who have increased their investments in the last three years to boost
productivity now expect to benefit from the resumption of business on the U.S.’ real estate market, but an
expected decline in housing starts in Canada and Québec, as well as high consumer debt and fragile
consumer confidence, could dampen their enthusiasm. Over the next three-year period, the industry will
stabilize its number of jobs at the beginning of the period to subsequently record a slight growth. It is
expected that that the level of employment will only increase by 0.1% a year by 2015.
Miscellaneous manufacturing
Lastly, in various manufacturing activities, the rescue of a manufacturing plant of hospital beds by Groupe
Bertec, at a cost of $6.4 million in July 2012, has helped save 80 jobs in L’Islet. Of note, in December
2010, the multinational Flextronics – which had just taken possession of plant activities from American
company Stryker – announced production transfer to Mexico and the gradual loss of 350 jobs until its
closure in June 2012. Consequently, an average decline in employment of 0.8% a year by 2015 is
expected, mostly in 2013 and a slight rise occurring only at the end of the forecast period.
Resource-related manufacturing
The employment level in resource-related manufacturing has mirrored trends in the wood
product industry, which had been facing significant structural and cyclical difficulties since the
early 2000s. However, employment started rebounding in 2012 and is expected to do so until
at least 2015
Table 5 – Employment Breakdown and Outlook in the Resource-Related Manufacturing Sector
Average for 2010–2012
Chaudière-Appalaches Region
Level
thousands
Region
Share of
Employment
Region
Province
2013–2015
Annual Average
Growth Rate
Region
Province
Whole Manufacturing Sector
Resource-Related Manufacturing
43.1
11.8
19.9%
5.5%
12.5%
2.6%
1.0%
0.6%
0.6%
0.0%
Wood Product Manufacturing
8.5
3.9%
0.9%
0.7%
0.8%
Source: Service Canada, Quebec Region
Historical estimates based on Statistics Canada’s Labour Force Survey
P a g e | 23
Although resource-related manufacturing is the smallest manufacturing group in the region, it employs
close to 12,000, and represents 5.5% of regional employment as well as 27.4% of all regional
manufacturing jobs. Over the last 10 years, the employment level has been falling at an average rate of
0.6% a year, with a dip in 2007. This trend mirrored that of wood product manufacturing, which employs
more than 70% of workers. Despite a downward trend in the last decade, job losses came to a halt in
2012 and were transformed into gains following a recovery in production in the wood products segment.
This increase is expected to continue into 2015, at an average rate of 0.6% per year. The main industries
of the group will contribute to this progression, in varying degrees.
Wood product manufacturing
Despite structural and cyclical difficulties, the regional wood product industry is still one of the leaders of
manufacturing industries in terms of production and delivery, as well as the number of businesses and
jobs. The regional industry is comprised of approximately 175 businesses that supply work to 8,500
people. The employment level corresponds to close to 20% that of manufacturing and approximately 23%
of Québec’s industry. It also represents close to 15% of the manufacturing GDP and 20% of the provincial
industry’s production. The industry, which is very varied, does not depend vertically on large integrated
companies, but on SMEs who manufacture products for the construction, furniture, transportation
equipment, as well as the secondary and tertiary wood processing industries.
Difficulties within the wood industry began in the early 2000s during the Canadian-American conflict on
timber, but have been aggravated recently by the slumping real estate sector in the United States and the
general downturn in the North American economy, as well as by the strong Canadian dollar, which has
undermined its competitiveness. In the last decade, plants have had to manage declining outputs.
Following layoffs and plant closures, the industry has become much smaller. In the region, employment
has decreased by an average of 1.6% a year since 2002 following the slump in the market. More recently,
employment levels rebounded in 2012, increasing by almost 20%. The wood finish and imitation wood
product industry is a niche for excellence identified by regional stakeholders.
With hopes of the U.S. market rebounding, wood product manufacturers are moderately optimistic about
the future, as many of them are conducting business in export markets. Although housing starts in the
United States have started growing again, they are currently inferior to household formation and, unlike in
the last six years, supply and demand for housing is nearly balanced. Moreover, rising product prices will
cause companies to create a new production capacity, as well as to invest and to expand existing
sawmills. The proximity of its main target market, the United States, where close to 90% of exports are
concentrated, will allow the industry to start growing again as conditions improve for our neighbours to the
south. After dipping by more than 60% since 2004, foreign shipments of Québec lumber have rebounded
with an increase of 9% in 2012 and shipments to the United States, by 14%. Furthermore, the demand for
wood chips and other wood residues will remain moderate given the slight increase in demand for
cardboard or moulded panels coupled with diminished needs of the paper manufacturing industry. In
order to survive the competition and to expand, the industry will have to be at the forefront of innovation to
improve its productivity and the quality of its products and gain an advantage on foreign markets by
calling on state-of-the-art technologies. One of the paths for the future of the industry is the production of
engineered wood for the non-residential construction market; this path will be reinforced with the
government’s adoption of a charte du bois (Timber Charter) that favours the use of timber in construction
and the enhancement of the tax credit. Lastly, diversified markets and products are key to help the
industry withstand future economic shocks and the ups and downs in the housing market. Given a more
favorable context, employment levels in the regional wood product manufacturing industry are expected
to increase by an average rate of 0.7% a year by 2015.
Petroleum and coal product manufacturing
In the petroleum and oil product manufacturing industry, the Jean Gaulin refinery (Ultramar) has
completed a number of major investment projects at its Lévis refinery in the last 15 years, including the
2012 construction of its pipeline that links the refinery to its Montreal-East terminal ($400 million).
P a g e | 24
Recently, the oil company showed interest in refining Alberta oil and is even ready, according to
management, to invest in its facilities in Montreal-East ($100 million) and Lévis ($20 million) to refine
Alberta oil if the Enbridge project of reversing oil supply between Sarnia and Montreal comes to fruition.
The Lévis refinery will thus maintain its production capacity of 260,000 barrels per day, but approximately
60% of crude oil would arrive from Alberta, while the totality currently comes from overseas. However,
there will not be many jobs created other than for work periods.
Non-metallic mineral product manufacturing
The employment level of the non-metallic product manufacturing industry, which employs approximately
one thousand workers in the region, has been fluctuating since 2002, but the long-term trend was a
decrease (-2.2%), despite an improvement in 2007. In the region, production, closely associated with the
construction industry, is focused on concrete, as well as concrete and glass products. In recent years, the
strength of residential construction and investments in public facilities has supported employment. Over
the next few years, despite a certain decline, the level of activity in residential construction will be fairly
high while non-residential construction will be on the rise. A slight increase in employment within the
industry is expected by 2015, at an average rate of 0.5% annually.
Primary metal manufacturing
Primary metal manufacturing relies in great part on a dozen smelting works. After a strong decline in the
early 2000s, the employment level has grown in the last few years in spite of a decrease in activity and
downsizing during the recession. The use of traditional metals, such as steel and iron, is facing growing
competition from other metals, namely ceramics, plastics and composites, and aluminum, which have all
recorded a significant growth. Trends in the regional industry depend on the manufacturing sector, which
has had its share of troubles in recent years, but has since rebounded, as well as other industries such as
mining and quarrying, and construction and energy, which have recorded strong growth. However, higher
energy costs and the strong Canadian dollar will decrease homebound companies’ competitive
advantage. The industry will also face fierce competition from emerging countries, but will attempt to take
advantage of growing demand for these new markets, as well as the possible turnaround of the U.S.
economy. The employment level should progress slowly in the coming years, at an average of
approximately 0.6% a year by 2015.
Investment-related manufacturing
After losing close to one worker out of five since 2005, outlooks for investment-related
manufacturing are significantly more attractive thanks to the relaunch of the Lévis shipyard by
the ZM Industries Canada firm
The employment level in investment-related manufacturing is estimated at close to 16,000 in the region,
or 7.5% of total employment and close to 37.5% of manufacturing employment. The region represents
7.6% of the provincial workforce of this category of industries. This group generates massive investments
in machinery and equipment year after year and a higher value-added production. Many companies have
had to adjust to the new environment of globalization by making innovation a key determinant of growth.
Apart from a few ups and downs, the employment level in investment-related manufacturing changed
very little over the last ten years or so, posting an average annual growth rate of 0.2% since 2002, with a
recent sharply upward trend. This evolution is due to the good performance of metal products and
machinery industries that have compensated for the less favorable conditions in plastics manufacturing
and transportation equipment. Prospects for this group of industries are a lot more encouraging today,
notably with the reopening of the shipyard by ZM Industries Canada. Consequently, increased
employment growth is expected by 2015 in this industrial group, namely 1.9 % per year.
P a g e | 25
Table 6 – Employment Breakdown and Outlook in the Investment-Related Manufacturing Sector
Average for 2010–2012
Chaudière-Appalaches Region
Level
thousands
Region
Whole Manufacturing Sector
Share of
Employment
Region
Province
2013–2015
Annual Average
Growth Rate
Region
Province
43.1
19.9%
12.5%
1.0%
0.6%
16.2
7.5%
5.4%
1.9%
1.3%
Plastics and rubber products
3.7
1.7%
0.7%
0.6%
0.5%
Fabricated metal product manufacturing
4.7
2.2%
1.0%
1.5%
2.1%
Machinery manufacturing
3.2
1.5%
0.8%
1.1%
1.6%
Transportation equipment manufacturing
2.8
1.3%
1.4%
6.3%
3.2%
Investment-related manufacturing
Source: Service Canada, Quebec Region
Historical estimates based on Statistics Canada’s Labour Force Survey
Plastics and rubber products
The rubber and plastic products industry is comprised of sixty-some plants that employ some 3,700
workers who work essentially in the processing of plastics and the forming of composite materials that
constitute a niche of excellence for the region. The regional industry is characterized by the diversity of
manufacturing procedures and the presence of various business models in the packaging, construction
products, environment and transportation markets. The region’s companies employ more than 13% of
Québec industry workers and produce the equivalent of 12% of the value of the provincial GDP. After a
solid performance in the early 2000s, the regional industry has been going through a yearly decline since
2005, with the loss of 4,000 positions, resulting in an average yearly decline of 11% during this period.
This turmoil has forced companies to invest in research and development (R&D), to acquire state-of-theart equipment, to market innovative products and acquire new clients to face fierce competition. Leaders,
such as IPL, who is pursuing the restructuration of its operations and is putting focus on R&D, and MAAX,
a manufacturer of bathroom products, which is constantly innovating and marketing new products, are
hoping to become world-class companies in their respective niches. This also goes hand in hand with
what the regional industry has given itself as a structuring strategy, namely, to improve productivity, to
seek a presence in new markets and to reduce production costs, while investing in the purchase of
equipment and the increase of production capacity. More and more, foreign companies, mostly Asian, are
taking away market shares from local companies who are struggling to remain competitive, notably
because of high labour costs. Despite the volatility of production costs which are raising concern for the
possibility of a reduction of business profit margins, the recent growth in production and shipments,
coupled with the anticipated rebound of the U.S. economy, sends a positive signal for a reversal of the
trend for labour demand. By 2015, modest employment growth is expected, at approximately 0.6% per
year.
Fabricated metal product manufacturing
Approximately 4,700 people work within 170 specialized plants in fabricated metal products
manufacturing, which corresponds to 11% of manufacturing jobs and more than 12% of industry jobs
across the province. The Chaudière-Appalaches region represents 11% of production and 13% of
investments of the Québec industry. After reaching a peak in 2001, the employment level has seen more
negatives than positives until 2009 to then follow an upward trend in the last three years. This non-linear
evolution is due to the rising Canadian dollar, the slowdown of the economy and the general decline of
manufacturing that have contributed to the slide in employment until the late 2000s. Subsequently, the
upturn of the economic environment, particularly in the manufacturing sector and in non-residential
construction, has given way to an increase in demand for metallic products. Some of leaders of the
regional industry (Groupe Canam, Industries Canatal and Supermétal), who specialize in the construction
of buildings, bridges and metallic frameworks, are building on major infrastructure projects in the large
P a g e | 26
North American market. Their situation seems favorable, given well-filled order books and sales that have
grown in the last two years. In the medium term, demand for metallic products will be stimulated by the
strengthening of the U.S. economy, which will be even more visible in 2014, the strength of nonresidential construction, as well as renewed growth in the manufacturing sector. The industry will continue
to face fierce competition from overseas. On another hand, emerging countries, where manufacturing
production is rapidly growing, are also markets for our companies to tap into. The growing demand for
commodities worldwide will increase the demand for machinery and equipment from many industries,
notably energy, mining and manufacturing, where metallic products are key components. Given the
favorable environment, the industry’s employment level will experience growth that will be above the
average for all industries during the three-year period in the region, at an average of 1.5% a year between
2013 and 2015.
Machinery manufacturing
The machinery manufacturing industry provides work to approximately 3,200 people in ChaudièreAppalaches. It is made up of close to a hundred-some SMEs specialized in handling equipment,
machines and commercial equipment, agricultural, forestry and mining machinery, heating and
refrigeration equipment, engines as well as miscellaneous manufacturing equipment. The demand for
these products depends on a number of things, but a healthy economy, however minimal, and the
recovery of the manufacturing sector as well as the willingness of businesses to invest in machinery and
equipment are the key factors. Severely shaken up by the last recession, the recovery has helped regain
jobs lost in 2009 and even exceed the employment level before the recession. This recovery was the
result of favorable conditions for investments to grow companies’ productivity. Given that the environment
is fairly beneficial, ongoing employment growth is expected in the machinery industry in the next three
years, at an average of 1.1% per year.
Transportation equipment manufacturing
The transportation equipment industry employs about 2,800 workers in Chaudière-Appalaches,
representing roughly 6.5% of regional manufacturing employment, who work in forty-some plants. The
regional industry, which was not spared by difficult economic conditions, has lost 40% of its workers since
2002, or 1,800 positions. Output and shipments have decreased during this period, which coincided with
the closure of the Davie shipyard and difficulties in the North American coach market, forcing Prévost
Car’s management to proceed with a major reorganization that led to many layoffs. However, prospects
are a lot more promising for the industry with the reopening of the Davie shipyard by its new owner, ZM
Industries, which should lead to the recall and hiring of more than 500 workers by the summer of 2013.
The shipyard’s management intends to make the construction of three of Cecon’s boats, a Norwegian
company, a key priority. This project was put on hold at the time of the shipyard’s closure in February
2010. The shipyard also holds a $120 million contract to build two ferries for the Société des traversiers
du Québec (STQ). Let us remember that in the last three years, Davie has been placed under court
protection and sold on two occasions. As for Prévost Car, the relationship that began in 2007 with
intercity bus Greyhound is ongoing. Recently, the Sainte-Claire plant obtained another contract, the value
of which could reach $45 million, for the construction of 90 coaches for Greyhound. Prévost will build, in
2013, fifty-some coaches, and a clause in the contract states that Prévost could provide 40 others to its
client in 2014. After hitting a low period between 2008 and 2010, which forced transportation companies
to report the renewal of their fleet, Manac, a semi-trailer manufacturer in Saint-Georges, has taken
advantage of the market recovery in 2011 and 2012, and this trend should continue in the medium term.
On its end, Groupe Labrie keeps winning manufacturing and distribution contracts for waste
transportation vehicles. In this context, a strong employment level increase in the equipment
transportation industry is expected, at an average rate of 6.3% per year.
P a g e | 27
Tertiary sector
The large services sector has known a solid performance in the last decade. By 2015, the
services industries will generate nearly 80% of the 5,200 new jobs in the region
Significantly less dominant than in most other Québec regions, services employ nearly 147,000 people in
Chaudière-Appalaches, providing approximately 68% of regional jobs, compared to 79% in Québec as a
whole. The GDP of the service industry accounts for less than 60% than total regional output compared
with 70% in the province as a whole. This sector has had a solid performance in the last decade in the
region, with its employment level rising by an average of 1.7% a year (+27,500) between 2002 and 2012,
despite a decrease of 3.3% in 2012.
Since the early 2000s, services have taken over the manufacturing sector, which has gone through a
transformation and downsized, allowing the regional economy to continue to create thousands of jobs.
This transition to an economy more based on consumption, services to individuals and companies, as
well as knowledge, has benefited many service segments. Moreover, for over 20 years, there has been a
strong growth in production services, and particularly, support services and professional, scientific and
technical services. Many reasons explain this growth: the rapid development and accessibility of
information technologies, the rise of engineering consulting and architectural services following massive
investments in infrastructures, as well as increasing outsourcing that assigns to an external company the
responsibilities that were until now, the duties of internal management.
With an anticipated increase of 0.9% a year by 2015, the three service categories will have a hand in
employment progression. Nevertheless, production services will be, once again, the most dynamic, with
an average increase of 1.3% annually, while consumer services and government services will each
record employment levels of 0.8% and 0.7% during this period. By 2015, nearly 80% of 5,500 new jobs
will be generated by the large service sector in the region.
Consumer services
Consumer services, which employs approximately 51,000 people, half of them in retail trade in
the region, is the most important service group in the region
Table 7 – Employment Breakdown and Outlook in Consumer Services
Average for 2010–2012
Chaudière-Appalaches Region
Level
thousands
Region
Service sector
Consumer Services
Retail Trade
Share of
Employment
Region
Province
2013–2015
Annual Average
Growth Rate
Region
Province
146.8
51.0
67.9%
23.6%
79.2%
27.2%
0.9%
0.8%
1.0%
1.0%
24.9
11.5%
12.2%
0.8%
0.9%
Information, Culture and Recreation
4.1
1.9%
2.8%
0.6%
1.1%
Accommodation and Food Services
13.4
6.2%
1.5%
1.1%
1.1%
8.7
4.0%
1.1%
0.7%
1.0%
Other Services
Source: Service Canada, Quebec Region
Historical estimates based on Statistics Canada’s Labour Force Survey
Consumer services is the most important service group in the region. It employs approximately 51,000
people, nearly 24% of the regional employment total compared to 27% in Québec as a whole. Close to
half of positions are in retail trade. The employment trend generally hinges on changing demographics,
P a g e | 28
overall employment, personal income and general economic conditions. Employment has increased by
an average of 1.2% a year over ten years. But this increase has considerably slowed down in the last five
years (0.6%), as the employment level fluctuated as a result of a less than favorable economic
environment. Since 2007, information, culture and recreation, as well as the other services have been
affected by job losses, while retail trade maintained a modest growth, and the accommodation and food
services industry was doubling this group’s growth rate. In the medium term, the economic environment
seems fairly favorable, given the important retail space development projects. However, household debt,
coupled with weak consumer confidence and an outlook of modest growth in employment and disposable
income, may cause consumers’ enthusiasm to wane and force them to rethink their expenses. This
should lead to a moderate employment growth in consumer services, at 0.8% a year by 2015. All
segments will benefit from an increase, but accommodations and food services, as well as retail trade, will
create more jobs.
Retail Trade
Retail trade provides work to nearly 25,000 people in Chaudière-Appalaches, accounting for 11.5% of
regional employment, compared with 12.2% in Québec. The regional workforce made up 5.1% of the
province’s workforce in this industry. Since 2002, the employment level has shown an erratic trend from
year to year. The basic trend shows a 0.9% growth per year over the last ten years, while the last five
years were characterized by a greater variability. Many structural and cyclical factors explain this mixed
evolution, including a halt in the growth of economic activity caused by the recession, the slow rise of
incomes, a moderate progression in investment, a purchasing power weakened by a rise in taxes, fees
and social security taxes, in addition to the restructuring of a mature industry that is operating in a fiercer
global market that reduces retailers’ profit margins.
In the region, there are large-scale investment projects in the commercial industry. For example, the
Carrefour Saint-Romuald project, intended to set up a new commercial and residential centre near the
bridgeheads and whose construction will begin in 2013 at a cost of $400 million, will house nearly a
dozen big box stores and create more than 2,000 direct jobs. Furthermore, the development of
institutional and commercial spaces at Cité Desjardins, within the Centre des congrès et d’exposition of
Lévis, as well as investments in other urban sectors of the territory, will stimulate the arrival of new
businesses, where warranted by demographic growth. With the construction of two stores in the region, in
Lévis and Saint-Georges, retailer Target will invest several millions and create between 150 and 200 jobs
per store. The arrival of new big chains set to immediately become major players, could create other
consolidation movements in already tight markets where sales increase at a rather modest pace. By
strengthening a competitive environment, the setup of these new chains, which offer a wide range of
options, diminish the profit margins of traditional chains and forces them to revisit their strategies to retain
their clientele and reorganize their distribution process and their operations. Local retailers will have to
rely more on beneficial market segments and niche products while ensuring quality customer service.
Furthermore, consumer behavior changes continuously, and sometimes in a radical way. Among the new
consumption patterns are organic and health products, fair trade, ethical consumption, the growth of ecommerce and lastly, the explosive rise of mass digital mobile products. Economic growth was fuelled by
household consumption in the last few years due to low interest rates. But today, debt and reduced
purchasing power leave very little freedom to consumers whose trust has waned. In this context,
employment growth in retail trade by 2015 will be closer to that of the regional average, around 0.8 % a
year, which will lead to the net addition of approximately 600 new positions in the region during the next
three-year period, thus indicating that investments targeting the implementation of big box stores will
surely lead to the creation of new jobs, but also, the closure of small businesses unable to survive this
new competition.
Information, Culture and Recreation
The information, culture and recreation industry workforce is estimated to be just above 4,000 people in
Chaudière-Appalaches, or 1.9% of the region’s employment, a proportion that is one-half that of the entire
province (4.4%). Marked by ups and downs, the industry’s employment level has increased by barely
P a g e | 29
0.3% on average per year since 2002 and has even trended downwards in the last five years. This
evolution is the result of modest growth in population, investments, personal income and also of general
economic conditions. However, all regional stakeholders plan on pursuing the development of cultural,
sports and tourist facilities. With regards to arts and culture, stakeholders remain concerned about cuts
that could arise in capital and programs dedicated to the practice and dissemination of arts and culture as
well as heritage preservation by provincial and federal governments within the context of eliminating
budget deficits. In the telecommunications segment, service providers are complementing investments in
facilities and broadband technologies and in the deployment of new services to meet strong household
and business demand. The increase in the employment level is expected to be inferior to the regional
average in the next three years, at 0.6% a year by 2015.
Accommodation and Food Services
The accommodation and food services industry employs approximately 13,400 people, accounting for
6.2% of regional employment, a proportion similar to that of the industry in the province as a whole. From
2002 to 2012, the industry’s employment level, the growth of which is closely linked to tourism, has grown
at an average rate of 1.9%, even reaching 4.4% in the last five years. Despite the fact that ChaudièreAppalaches does not appear to be ahead of the pack of Québec’s tourism regions, this industry has
become a significant economic development lever in recent years. In addition to employment, output and
investments have also progressed since the second half of the 2000s. The industry GDP, which
represented approximately 3% of the entire regional output compared to 2.4% in Québec in 2010, has
increased by more than 22% between 2006 and 2010, while capital investments, which reached a peak in
2009, have progressed by 60% since 2005. In this regard, tourism has been greatly improved with the
opening of the Centre de congrès et d’expositions in Lévis in 2008 and significant investments in the
Centre des congrès of Saint-Georges. Infrastructure development will continue in the coming years,
notably with expansion work to the Centre des congrès of Lévis and the Four Point by Sheraton hotel,
valued at $36 million and which will begin in the spring of 2013. For its part, estate and vineyard la Cache
à Maxime in Scott will continue its expansion by investing approximately $20 million in the next year to
expand its banquet hall, open a restaurant and a lounge, and to acquire a 60-bedroom inn. Enhancing the
region’s tourist supply, as well as the complementarity and sustainability of products, services and
facilities are major issues, and even more so because of the renewal of a regional tourism partnership
agreement that aims to make the region seem more appealing and competitive as a tourist destination.
As for food services, where the clientele is mostly local, outlooks are modest given increases in the cost
of living, weaker consumer confidence and the level of household debt. Given the context, an increase in
employment in accommodations and food services is expected in the next three-year period, in the order
of 1.1% per year.
Production services
Production services make up one of the leading production and investment industry groups,
which has a positive impact on the volume of jobs.
Recognized as a principal source of growth in economic activity and employment, production services
employ roughly 46,000 people in Chaudière-Appalaches. For nearly a dozen years, this group has been
flourishing: its relative weight across regional jobs has gone up from 18.4% in the early 2000s to 21.2%
today.
P a g e | 30
Table 8 – Employment Breakdown and Outlook in Production Services
Average for 2010–2012
Chaudière-Appalaches Region
Level
thousands
Region
All services
Share of
Employment
Region
Province
2013–2015
Annual Average
Growth Rate
Region
Province
146.8
67.9%
79.2%
0.9%
1.0%
45.9
21.2%
26.0%
1.3%
1.3%
Wholesale Trade
7.1
3.3%
3.9%
1.4%
1.5%
Transportation and Warehousing
Finance, Insurance, Real Estate and
Rental and Leasing
Professional, Scientific and Technical
Services
Business, building and other support
services
9.3
4.3%
4.4%
1.4%
1.5%
13.9
6.4%
5.8%
1.2%
0.9%
9.9
4.6%
7.6%
1.4%
1.6%
5.2
2.4%
3.7%
1.0%
1.0%
Production services
Source: Service Canada, Quebec Region
Historical estimates based on Statistics Canada’s Labour Force Survey
The employment level has progressed at an average rate of 2.3% a year since 2002, which is three times
as high a rate as seen in all industries combined, despite a decrease of more than 12% during 2012
alone. Transportation and warehousing, profess
sional, scientific and technical services, as well as management and administrative support services,
were at the helm of this progression. This group is characterized by a growth in investments, output,
added value and in exports, as well as by its contribution to other sectors in terms of productivity and
innovation, which has spurred the growth of demand for this sort of services. This impulsion is due, in
part, to the common business practice of outsourcing some in-house functions, such as computer science
and information technologies (IT), maintenance and custodial services, human resources, and
accounting, bookkeeping and payroll, which are subcontracted to specialized firms. Companies are thus
using this strategy to meet the challenges posed by technological progress, an increased specialization of
skills, fierce competition, the search for enhanced productivity and profitability, and the need for greater
flexibility in the organizational structure. Furthermore, architecture and engineering consulting firms rank
among sectors with strong growth. They have been greatly supported by a strong growth of investments
in public infrastructures. During the forecast period, this group will continue to have an important positive
impact on regional employment growth. With the support of most activity segments, to the exception of
public services, production services will see its employment level progress by an average of 1.3% a year
by 2015, which will result in an addition of some 1,700 new positions.
Wholesale Trade
Wholesale trade employs over 7,000 people, accounting for 3.3% of regional employment compared to
3.9% in Québec. The employment level has trended downwards in the last decade, at an average of
1.4% per year, even culminating in a decrease of 11% on average for each of the last three years. The
regional industry is very fragmented and made up of more than 600 businesses, 96% of which employ
less than 50 employees. The industry’s development is linked foremost to that of retail trade. These last
few years, consumption slowed down due to increases in sales taxes, weak consumer and business
confidence, modest income growth and household debt. The invasion of major international chains, the
transformation of other big retailers into smaller stores, fierce competition, and the push for greater
productivity have led wholesalers to centralize their distribution and warehousing operations in major
urban centres to the expense of intermediate regions. Technology, as well as an improvement to tracking,
shipping and storage processes have allowed companies to greatly increase their productivity. Given that
major investments have been made in the last five years and more are expected to revitalize and develop
P a g e | 31
the region’s commercial sector, we are anticipating a trend reversal in the wholesale trade industry, which
will lead to an annual average employment growth rate of 1.4% in the next three years.
Transportation and Warehousing
The transportation and warehousing industry is another catalyst of economic growth in the regional
economy. It employs about 8,600 people, half of them in truck transportation. It accounts for 4.3% of
regional workers, a percentage that is almost the same as that of Québec as a whole (4.4%). The
regional industry is highly fragmented, with of 97% of its establishments having less than 50 employees,
and a strong proportion of self-employed workers (independent truckers, taxi owner drivers and
independent messengers and deliverers). Generally, all companies require transportation services, no
matter who the market players are (natural resource-based producers, manufacturers, wholesalers,
service providers, retailers, etc.). On the other hand, the industry is also very dependent on trends in
wholesale and retail trade, the volume of cross-border trade of goods, the level of manufacturing output,
fuel price fluctuations, as well as general economic conditions. In the last decade, employment has gone
through great variations, but the fundamental trend shows strong growth, estimated on average to 4.9%
per year, which also gained steam in the last three years and even offset the previous loss caused by the
recession. During the last three-year period, employment gains mostly came from the public transit and
tourism segments, as well as from postal and messenger services.
Truck transportation, which still remains the mode of transportation preferred by companies for supply
and shipments, has benefited from a liberalization of trade in North America and favorable economic
conditions until the mid-2000s. However, trucking has also faced difficulties at the end of the last decade,
caused by a decline of the manufacturing sector, falling exports and the deterioration of the U.S.
economy, but the situation has rectified itself since 2010. Logistics and management of the supply chain
have contributed to improving productivity in recent years, thus slowing down employment growth. This
trend is likely to continue in the future, with increasing competition forcing companies to take advantage
of gains in productivity due to the use of new technologies. In the public transit segment, the Société de
transport de Lévis intends to continue its development and growth by focusing on improving its service
offer delivery, the acquisition of new equipment, and the use of new technologies. As for railway
transportation, the implementation project of an intermodal terminal at the Joffre train yard owned by
Canadian National (CN) in Lévis’ Charny sector has been put on hold by regional stakeholders. Faced
with declining demand for traditional postal services, caused by the advent of communication
technologies and competition from big private firms that offer messaging services, Canada Post has been
undergoing a period of structural changes, cost reductions and improvements to productivity for a few
years now, which resulted in work volume reduction. The company plans to increase its parcel
transportation market shares stemming from e-commerce, as online sales is a strongly growing segment;
but for the time being, this measure does not quite compensate the heavy losses incurred in the segment
of letter and advertisement circular delivery.
In summary, the regional transportation and warehousing industry will see its employment level grow by
an average of 1.4% a year between 2013 and 2015.
Finance, Insurance, Real Estate and Rental and Leasing
The finance, insurance, real estate, rental and leasing segment represents the largest industry in
production services, providing around 14,000 jobs, or 6.4% of regional employment (compared with 5.8%
in Québec). This industry contributes greatly to the region’s economic activity, as the industry’s GDP
accounts for more than 30% of regional output in the service sector, compared to less than 24% across
the province. Even though they vary greatly from year to year, the industry’s investments, which
accounted for more than 16% of services capital in 2012 (compared to less than 13% in Québec), have
declined in recent years, whereas they had been equivalent to one third of services capital in 2005. For
ten years, employment has progressed at an average of 1.0% annually as a result of the development
and diversification of financial services, which was stimulated by the growth of the wealth management
and retirement planning sector, as well as intense activity in the real estate sector. However, this trend
P a g e | 32
slowed down in 2008 due to an economic situation which deteriorated following the burst of the
speculative real estate bubble worldwide and the ensuing financial crisis.
The Mouvement Desjardins headquarters and its network of caisses are situated on regional territory is,
as well as many branches of major Canadian banks who offer a complete range of banking services,
investment services and financial services. Mirroring the entire banking sector, Mouvement Desjardins,
the biggest employer in the region with nearly 6,000 employees, has gone through a thorough
reorganization, consolidation and rationalization process in the last decade, which led to a reduction of
the number of branches following mergers and closings. During this period, counter traffic declined in
favor of telephone and online transactions, which still require important financial resources for their
development. Desjardins also continues to promote growth and innovation through investments into
technological infrastructures, as well as the introduction of new services and service centres that are
better adapted to meet present needs. In order to stay competitive with banks, Desjardins must be able to
remain on solid financial footing. The recent financial crisis has led leaders to reinforce the capital base
by relying on its own surpluses rather than borrow from international markets. To improve service to
members, Desjardins’ management plans to follow in the footsteps of some of its competitors by
extending its business hours into the weeknights and on the weekends within some of its key
establishments and even considers the creation of new caisses where population growth is high. In order
to bolster its presence in the region, Desjardins is currently finalizing the redevelopment of its campus in
Lévis and the Cité Desjardins de la coopération for $125 million, which will include, among other things, a
new 15-story building housing nearly 1,500 employees.
Over the past few years, the difficult economic environment has been affecting the insurance segment,
which experienced a decline in performance. The financial crisis, economic uncertainty, stock market
volatility and the persistent weakness of interest rates affect companies’ financial results. Thus, they are
seeking to find ways to improve their business processes and control their costs to increase their
efficiency and productivity. The industry also faces many challenges, such as standardized products,
increasing competition, an aging population and a mature market. The expansion of the distribution
network and the arrival of new products should support sales. Given that Québec’s market is close to its
saturation point, the growth strategy essentially takes place through strategic acquisitions outside of
Québec and by acquiring small market shares from its competitors. An aging population and increased
interest of individuals in their future and financial security since the financial crisis puts great pressure on
demands for insurance consulting and financial services, and have led to a change in supply and a
multiplication of financial products. All of these activities will generate additional labour force
requirements, but employment progression will be limited following domestic market saturation.
With the tightening of mortgage rules, coupled with household debt and a declining pace of housing
construction, the residential transactions segment will lose steam, which should lead to a more balanced
market between vendors and buyers and diminished demand for real estate services. By contrast, the
commercial segment will still be booming, as the market is still supported by large-scale commercial
building and office projects and a relatively low vacancy rate. Moreover, the commercial real estate
market will achieve an above-average performance. Our forecasts are relying, among other things, on the
progress of work on the construction of the scientific and technological park L’Innoparc, a $100 million
project that will house 75 new businesses and create 1,200 jobs, the construction of Cité Desjardins de la
coopération ($125 million), the implementation of the Carrefour Saint-Romuald, a mega shopping centre
($400 million), the construction of a condominium tower ($30 million) near the Centre des congrès et
d’expositions, and the expansion of the latter, as well as the redevelopment of the ferry area ($19 million).
In summary, despite expected corrections to the residential real estate market, the intensification of
competition, household debt, the favorable business environment in commercial real estate and the
planning of major investment all hint to an increased demand for financial, insurance and real estate
products and services, which will translate into an annual average employment growth rate of 1.2% by
2015, which is slightly higher than that observed in the last ten years (1.0%).
P a g e | 33
Professional, Scientific and Technical Services
Professional, scientific and technical services provide employment for nearly 10,000 people in the region,
corresponding to 4.6% of total employment, compared with 7.6% in the province as a whole. The region
has proportionally fewer jobs in computer systems design, management consulting services, as well as
scientific and technical consulting services, but more jobs in legal services as well as architectural,
engineering, prospecting and design services. Though currently growing, the industry GDP’s direct
contribution to regional production is only marginal; the industry is closely linked with the development of
other industrial segments, such the manufacturing sector. Despite a significant drop in 2012 (-20%),
employment has strongly increased in the last decade, by an average of 3.8 % a year between 2002 and
2012, notably in architecture, engineering, prospecting and design services, computer systems design,
and scientific and technical consulting services as well as management. This performance was driven by
multiple infrastructure projects, business investments in machinery and equipment, the growing use of
information technologies (IT) and an increasing outsourcing of functions such as computer science and
information technologies, and bookkeeping and payroll services. The high level of investments in public
infrastructures will still support a strong demand for architectural and engineering services. The upward
trend toward a push for greater productivity will also encourage businesses to call on specialized
consulting firms and invest more into new technologies, as well as in research and development. For its
part, Creaform, specialized in 3D technologies and digital solutions, continues to expand and plans to hire
nearly 180 new workers in the next three years. The company also plans to invest more than $2 million to
establish a Creaform University to ensure employees are up-to-date with regards to knowledge and skills.
This expansion plan relies on the opening and growth of markets, as well on the diversification of
Creaform’s service offering. This economic activity segment will therefore see its employment level rise by
an average of 1.4 % a year by 2015.
Management of companies and enterprises and Administrative and support, waste management
and remediation services
The administrative and support, waste management and remediation services industry employs
about 5,200 people in the region, which represents 2.4% of the region’s employment total, versus 3.7 %
in Québec. The industry, which groups a wide range of sub-sectors that operate in distinct markets, has
greatly expanded in the last decade, which resulted in employment growth of 2.7% on average per year
since 2002. The industry’s performance will be based on a combination of rather positive and sometimes
divergent trends, notably trends in the growth of regional economic activity, the outsourcing of business
processes (administrative services, human resources and business support), the organization of fairs and
conventions, environmental protection services, water treatment and the management of waste and
recyclable materials, as well as protection and security needs. However, these growth factors will be
deterred by the slowdown of the real estate market and the negative impact of the Internet on travel
agencies. A moderate growth averaging 1.0% a year by 2015 is expected.
Public and parapublic services
Over the past years, the evolution of employment in public and parapublic services was
marked, at first, by the implementation of economic action plans in 2009, followed by a
commitment from governments to balance their budgets in the medium term.
Like other service groups, the public and parapublic services category, which provides employment to
nearly 50,000 people, occupies a less significant place in the regional industrial structure (23%) than in
that of Québec as a whole (26%). The employment level has increased steadily in the region since 2002,
by an average of 1.8% per year. This growth was a result of strongly increased spending in health
services and education during this period. Furthermore, the evolution of employment over the last three
years has been marked by the implementation of economic action plans in 2009, followed by a
P a g e | 34
commitment from governments to make deficit reduction a priority, with the objective of balancing the
budget in the medium term. By 2015, the group’s employment level should grow moderately, by 0.8% per
year, as gains in the health and social assistance segments, coupled with subdued growth in education,
will compensate for public administrations’ fiscal consolidation measures.
Table 9 – Employment Breakdown and Outlook in Public and Parapublic Services
Average for 2010–2012
Chaudière-Appalaches Region
Level
thousands
Region
All services
Public and parapublic services
Share of
Employment
Region
Province
2013–2015
Annual Average
Growth Rate
Region
Province
146.8
49.9
67.9%
23.1%
79.2%
26.0%
0.9%
0.8%
1.0%
0.9%
Educational services
10.8
5.0%
7.0%
0.4%
0.9%
Ambulatory health care and hospitals
13.6
6.3%
7.0%
1.3%
1.5%
Other health care and social assistance
Provincial and territorial public
administration
Local, municipal, regional and other public
administration
14.4
6.7%
5.7%
1.4%
1.6%
6.3
2.9%
2.1%
-0.4%
-0.5%
3.5
1.6%
1.7%
0.1%
0.4%
Source: Service Canada, Quebec Region
Historical estimates based on Statistics Canada’s Labour Force Survey
Educational services
Educational services employ 10,800 people in Chaudière-Appalaches, accounting for 5% of all workers, a
smaller share than in Québec (7%). Between 2002 and 2012, the number of employees increased by an
average of 1.5% per year, despite a downward trend between 2002 and 2008, followed by a recovery in
2012. This evolution reflects a decline in the number of students, increased school attendance, a
restructuring of the educational system, as well as government budget constraints. In a context of
expenditure reduction and control, the Québec government has announced, in its budget, that it intends
to continue investing in education and ensuring the maintenance of service quality, namely by offering
teachers professional support and by making the university system more accessible, while tightening
administrative expenditures and management costs. An increasing education budget will provide for a
reduction of the number of students per class in junior high school, added professional resources and
improved services to disabled students, or those with special needs. Following a decline in the student
population, the reverse is expected in the next three years. This should result in the overall growth of
nearly 2% in the number of students, essentially at the pre-school and elementary levels, while the
number of high school, college and university students will slightly decrease. It should also be mentioned
that discussions targeting the grouping of three of the region’s school boards in order to deal with budget
cuts have been interrupted in the fall of 2012. Budget cuts imposed by the government and the desire for
greater efficiency are expected to translate in job losses, especially in administrative and complimentary
services to students. For the next three-year period, a slight employment increase is anticipated, at 0.4%
per year on average, given the overall increase in the student population and investments in stay-inschool programs, reductions in class sizes and in student assistance, despite budget constraints.
Health care and social assistance
In the region, nearly 28,000 people work in healthcare and social assistance, which accounts for 12.9% of
regional employment. The growing and aging population has prompted governments to invest more into
healthcare and social assistance, which has had a very significant impact on a workforce that has grown
at an annual average rate of 2.7% in the last decade. This rate has even doubled since 2009. Since the
P a g e | 35
early 2000s, employment growth in healthcare and social assistance has coincided with the injection of
major investments related to human resources, prescription drug expenditures, the operation of
establishments, and the introduction of new technologies. Capital expenditures have more than doubled
in the region since the early 2000s to reach over $81 million in 2012. The main investment projects
include the expansion of emergency and hyperbaric medical services, as well as the construction of a
new radiotherapy center at the Hôtel-Dieu-de-Lévis hospital, in addition to the construction of a CLSC and
a residential and long-term care centre (CHSLD) at the CHSSS Alphonse-Desjardins. However, the
growth of health care spending is expected slowdown in the coming years, as the government is looking
to increase productivity, reduce overhead costs, control wages and set up strategic initiatives. The
development of a strong and accessible first line of medical care is at the top of the government’s
priorities in the matters of health, with the objective of 750,000 Quebecers registering with a family doctor
in the next two years. The growing and aging population will continue to exert pressure on the demand for
healthcare and social assistance services. However, these needs will be slowed down by weak economic
growth, coupled with the government’s commitment to balance public finances. As for childcare services,
the rise in the number of births and young children since the early 2000s has led the government to
announce, in February 2013, a new call for proposals with a view to create 15,000 new subsidized
daycare spots by the end of 2016, approximately 800 of them in Chaudière-Appalaches. Also, in the
context of contributions of daycare centres to achieving a zero deficit, the government has abandoned its
intention to demand cuts arising from a decrease of the “teacher-child” ratio, but rather, will recover a
portion of their surplus when it exceeds the allowable limit. In this context, it is believed that this activity
segment will show an average growth of 1.4% a year by 2015, which will generate nearly 1,200 new
positions during this period.
Public administration
The employment level in public administrations is estimated at 11,100 in the region: 57% work in
provincial administration, 32% in local and municipal institutions and 11% in federal administration. The
latter category accounts for 5.1% of regional employment, a relative share that is below that of the entire
province (6%). In spite of ups and downs, the region’s employment level has trended slightly downwards
in the last decade, at an average rate of 0.2% per year. During this period, an increase in employment
was recorded (+1.5%) within institutions and organizations reporting to the Québec government, while
local and municipal organizations have recorded relative stability and the federal public service has
suffered net losses (-7%). More recently, following a decline in 2009, the employment level of public
administrations grew vigorously in 2010 following the implementation of economic action plans aimed at
jump starting the economy and employment, followed by a decline in the last couple of years, which is in
line with governments’ cost-cutting measures that aim to eliminate budgetary deficits. Since the early
2000s, capital expenditures have multiplied by five to reach a record level of $465 million in 2011, or more
than 20% of the region’s non-residential investments. In the medium term, employment growth will
depend on demographic pressures, but especially on governments’ budget situation and their
commitment to restore fiscal balance, which will require a very strict resource management. The current
economic situation has major impacts on public finances and is forcing the State to reduce its
expenditures. Overall, the employment level in public administrations will decline at an average of 0.3%
in the next three-year period, as governments will prioritize to restore fiscal balance.
At the federal level, the government is pursuing its objective to reach a balanced budget in 2015-2016. In
its 2013 budget, the government intends to give priority to jobs, growth and long-term prosperity without
increasing taxes. To do this, the government wants to reorganize and control its spending more tightly,
and to better reinvest the money thus made available into the private economy. Moreover, it is well on the
way to achieving the savings announced in 2012, thanks to the abolishment of 19,200 positions (4.8 %) in
the federal public service. On December 31, 2012, 85% of positions had already been abolished, nearly
6
60% through attrition . Canada’s Economic Action Plan 2013 shows targeted savings at the Canada
Revenue Agency and Fisheries and Oceans Canada, as well as improvements to compliance programs
6
Government of Canada, Finance Canada, “Employment, growth and long-term prosperity: Canada’s Economic Action Plan 2013,
March 2013, 481 pages.
P a g e | 36
at the Canada Revenue Agency. The government also plans to implement a plan that aims to control
overall compensation costs. The government has also implemented a new program, Building Canada, to
finance infrastructures in the country, which will translate into $53 billion in investments over 10 years. In
the last decade, employment numbers in the federal administration, estimated at approximately 1,300 in
the region, has declined sharply. For the 2013-2015 periods, we are expecting a decrease in employment
in the federal public administration, at 1.0% per year in Chaudière-Appalaches.
For its part, the government of Québec is keeping to its commitment to a return to budget balance by the
end of the 2013-2014 fiscal year, after four years of deficits. To make this happen, the government is
counting on tight control of spending, including those related to programs and infrastructures, on
additional efforts from state-owned enterprises and on the reduction of the debt burden, all in line with the
evolution of economic conditions. In a difficult budget context, the government has decided to target
health, education and families as priorities, while promoting sound stewardship of public resources. With
7
regards to human resources, the entire workforce level of Québec’s public sector had fallen by 1.9%
since 2002-2003, but has recorded a 2.1% increase in 2012-2013 that is essentially explained by
additions to staff at the public security, transportation and health and social services ministries. In the
region, the employment level, estimated at approximately 6,300, has increased by an average of 1.5% a
year since 2002. In the current context in public finances, it is believed that the number of jobs in the
province’s public administration will decrease at an annual rate of 0.4% by 2015.
With regards to local administrations, the employment level, estimated at nearly 3,500, will only show a
slight growth, namely 0.1% per year, given the financial situation of municipalities and demographic
growth, as well as cost-cutting measures imposed by the government to public, local and regional
organizations, notably the Conférence régionale des élus.
7
Gouvernement du Québec, Secrétariat du Conseil du Trésor Québec, « Budget des dépenses 2013-2014. Renseignements
complémentaires » March 2013, 88 pages.