Fabricating our Future

Marie Laird, Chair, SME Toronto

There's a connection between the decline in manufacturing and the decline in the middle class. If we don't reverse the trend, we can look forward to careers in the service sector.

  

"Industry classification systems used by the government commonly divide industry into three sectors: agriculture, manufacturing, and services. The primary sector of industry is agriculture, mining and raw material extraction. The secondary sector of industry is manufacturing. The tertiary sector of industry is service production." (Wikipedia)

It's no secret that our country has progressed through the various stages of industry described above similar to most developed nations.  We started as farmers, fishermen, lumberjacks and miners - and progressed to the production of manufactured goods during the Industrial Revolution.

We have now moved into the tertiary sectors as evidenced by the fact that the service sector has grown to account for 71.3% GDP and 76% of the labour force (2009 stats). Higher commodity prices have helped revitalize certain primary industries, but manufacturing has continued to decline from a high of 29% of GDP in 1944 to only 13% of GDP and 13% of the labour force in 2010.

What do these statistics mean? Has our standard of living continually increased - in line with our progression through each of these stages?

When did Canada have the greatest sense of prosperity? When did people in Canada and people coming to Canada, on average, have the most positive outlook for themselves and their children? 

The answer is, "Not now." 

I'm not suggesting that life in Canada hasn't improved in many ways since we were primarily hewers of wood and drawers of water, or even when we were heavily focused on manufacturing.

However a high standard of living is more than just owning material goods once considered luxuries. The opportunity for all members of society to make a contribution, earn a good wage, and live a healthy life in a clean and safe environment plays a much larger role than often credited. A critical indicator of a high standard of living is a shared sense of hope for a better future.

For some people the good times continue. Unfortunately for increasing numbers, such as those formerly employed in manufacturing, the future is quite bleak and the gap between the rich and the poor continues to widen as opportunities for the middle class disappear.

Our collective hope for a better future is in decline and we no longer have confidence that life, in general, will continue to improve.

I looked at some average weekly wages by industry for 2010. Mining and oil and gas extraction had the highest average -$1700 per week (no surprise with commodity prices soaring). Forestry averaged $950 and manufacturing $960.

In the service sector, public administration (government jobs) averaged $1094 per week and finance and insurance industries came in at $1049.   However, there were other service sector positions which were much lower. Those in accommodation and food services, for example, earned an average of $354 per week and those in retail earned an average of $500 per week.

I couldn't find the answer, but I'd like to know the average wage in the service sector. I would bet that as we move more and more toward a service sector economy that our average wage as a nation will decrease...and that we will be more harshly divided between the upper class and the lower class with little in between.

Historically manufacturing played a strong role in the development and maintenance of the middle class. As manufacturing has declined, so too has the middle class.  Jobs in oil and gas, finance, insurance have not filled the gap. That's not to say those industries and jobs don't have a place...it's just a question of balance.

The service sector cannot revive the middle class.

So why are we still letting manufacturing decline? 

All the best!

Marie Laird
Chair
Society of Manufacturing Engineers Toronto
e: marie.laird@smetoronto.ca
w: http://www.smetoronto.ca
Advancing Manufacturing in Ontario