Revitalizing the Manufacturing Sector for 2022

Workforce Development: People are a Key Driver

The impacts of COVID have touched everyone, everywhere. There has been one sector however, that even with the setbacks has helped our economy rebound and even show signs of growth – manufacturing. Despite all that has occurred in the last 20 months, manufacturers are leading the way to recovery, however more is needed to ensure this continues and to revitalize the sector in 2022. COVID notwithstanding, during the past 3 years the top issue affecting manufacturers has been the skills and labour shortage. Not just the absence of skills, but also an alarming absence of available workers with any skill set. Manufacturing employment is highly valuable, with predominantly full-time positions dispersed all over Canada, offering substantial potential for wages, benefits and career progression. This provides stability to hundreds of thousands of families and surrounding communities across the country, however looking at the shortage of industry workers with appropriate skills, the lack of awareness and poor attitudes towards working in manufacturing presents a significant disadvantage for the sector. Manufacturers are also faced with unprecedented challenges associated with the accelerating pace of technological change, especially with respect to advanced manufacturing, digitization, automation, robotics, AI and other technologies. Unfortunately, this pace of change is rapidly increasing, while the pace of human capability is not keeping up. A call for talent strategies based on industry need and better labour market intelligence is needed for the Canadian manufacturers to succeed. Ensuring a steady workforce supply for future manufacturing is extremely important. EMC estimates 1/5 (20%) of the current manufacturing workforce will be eligible to retire in the next 10 years, which combined with current vacancies and upward productivity demands, will require a 20% to 30% increase in skilled worker supply to meet current and future performance and technology demands before 2030. To offset this, attracting and equipping younger workers earlier, as well as providing clearer paths to employment, opportunity, growth and development for diverse and barriered groups who might not otherwise consider manufacturing for a career, is an important part of this strategy. One such initiative includes EMC’s work-integrated learning, wage subsidized job placements, and preapprenticeship experiences. On the manufacturing operations side, the #2 most critical issue for manufacturers has been the increasing costs of production. Rising material costs, cost of legislation, energy, overall OpEx, scarcity of supply and supply chain disruptions – combined with the inability to fill vacancies and grow the workforce, has led to major capacity underutilization and in some cases increased unfilled orders and lost sales. The combined economic impacts are not sustainable. Fortunately, while supply chain disruptions and material shortages represent a significant physical barrier to manufacturing success, these constraints have also presented a number of opportunities for Canada’s manufacturers to demonstrate their abilities on a global scale, to recapture some local markets and re-shore production previously moved overseas. Adding new products, diversifying production and reengaging more geographically local markets resulted in a quick rebound on manufacturing production and sales, albeit needing a steady hand to navigate a twitchy marketplace, in light of industry operating at less than 80% capacity in Canada, and outstanding orders sometimes exceeding two months of national sales. For 2022, EMC is continuing its efforts to support our manufacturers, to tackle these issues and help revitalize the sector’s people, plant and process improvements. Manufacturers represent more than 12% of our total workforce and 10% of GDP in Canada. We have seen the sector rise to the challenges of the past 20 months and are fortunate to have such a vibrant sector to continue in the coming years. Manufacturers who would like to leverage the networking opportunities, expertise, training, education, and other resources, funding and support programs available through EMC can visit emccanada.org.

About Excellence in Manufacturing Consortium (EMC):

Excellence in Manufacturing Consortium (EMC) is a unique not-for-profit organization dedicated to helping manufacturers grow and become more competitive, at home and around the world. Founded 25 years ago, EMC has grown to become ‘Canada’s Largest Manufacturing Consortium’ and is one of the most active manufacturing organizations in North America.

ABOUT THE AUTHOR Scott McNeil-Smith

Scott is Vice President, Manufacturing Sector Performance, Excellence in Manufacturing Consortium (EMC)

Asked and Answered with Lerners LLP

We are Family: Important Considerations for the Family Business

Family businesses are unique, with many layers of complexity and with much at stake. The right advisors can help families navigate through these layers of complexity. Whether it be managing delicate family dynamics, preparing the next generation for ownership, or planning for the unknowns, family businesses need members. Those in family businesses ought to be preparing for and considering the impact of this eventual transition on the business needs and family dynamics as a result. No matter what the desired outcome is, the key for any transition plan is that it is an ongoing, continuous exercise – one that is led by the family, for the family.

It is an honour to work alongside family businesses through the planning process and to ensure they have the documents in place to cover an untimely death, or incapacity, such as Wills, Powers of Attorney and Shareholders Agreements. If you are part of a family business or think that your family may benefit from estate planning or related discussions, it is never too early to start the discussions and to make sure you have the right advisors to support you.

“...the key for any transition plan is that it is an ongoing, continuous exercise – one that is led by the family, for the family. ”

advisors who are equipped to help them through these processes. As a Family Enterprise Advisor (FEA), a designation administered by Family Enterprise Canada, I help families make time and space for the conversation of what transition of the family business looks like for their family. By interviewing individual family members, or facilitating family discussions, the right advisor can help get everyone to the table and allow for all voices to be heard.

Over the next decade or two, it is anticipated that many family businesses will transition from the founders of the businesses to their successors. At the same time, families may be exploring a sale of their business to a third party rather than a transition to the next generation of family

519.640.6301 hleitch@lerners.ca

Hilary Leitch

Hilary Leitch is an associate at Lerners LLP in our corporate group and a certified Family Enterprise Advisor. Her wills and estates practice focuses on estate planning and administration, including business succession planning, and family trusts, assisting clients with their overall estate planning needs.

RBC Dominion Securities in Waterloo is seeking motivated individuals for a fulfilling career in the wealth management industry. If you’re looking for the support you need to build a successful career, RBC Dominion Securities offers several advantages: ● Strength and stability ● Independence with support ● Powerful tools and technology ● Top-calibre training With an independent focus that encourages and rewards initiative, industry-leading investment and wealth management support, and the backing of Canada’s largest financial institution, RBC Dominion Securities is the premier choice for investment professionals who want to build a successful wealth management practice.

RBC Dominion Securities Waterloo is hiring new Investment Advisors

For more details, please contact Vice-President and Branch Manager Mark Hodson at 519-747-7790 or mark.hodson@rbc.com.

We value diversity in the workplace, are committed to Employment Equity and will provide reasonable workplace accommodation to applicants with disabilities. RBC Dominion Securities Inc.* and Royal Bank of Canada are separate corporate entities which are affiliated. *Member-Canadian Investor Protection Fund. RBC Dominion Securities Inc. is a member company of RBC Wealth Management, a business segment of Royal Bank of Canada. ®Registered trademarks of Royal Bank of Canada. Used under licence. ©2017 RBC Dominion Securities Inc. All rights reserved. 17_90561_001

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