Canada's ag manufacturing sector faces growth barriers — national supply chain challenges and labour shortages must be addressed now

  • National Newswatch

Although COVID-19 restrictions have lifted and the economy has begun to rebound from the pandemic, the drastic impacts on the supply chain and record labour shortages continue to shackle Canadian businesses — and nowhere can it be seen and felt more than in manufacturing.Canada's agricultural manufacturing sector produces the highest quality and most sought-out agricultural equipment in the world but is facing tremendous barriers to advancing innovation and global competitiveness, brought on largely because of these ongoing supply chain and labour issues.In order for the agricultural manufacturing sector in Canada to continue to thrive, the federal government must immediately address the need to build resilient supply chains to expand exports and secure a strong workforce. Given current geo-political turmoil, it is critical that Canada give special attention to our country's competitive advantages and foster innovation to ensure that Canadian manufacturers are able to grow their businesses.Building resiliency in our North American supply chains and anchoring access to global markets are essential if the government is to meet its goal of increasing Canada's exports of agri-food and agricultural products to at least $75 billion by 2025. Agricultural manufacturers have already established a strong international reputation that can be leveraged to help Canada meet this goal.But North American manufacturers are facing critical supply chain disruptions — including shortages and soaring prices — that threaten their ability to get cost-effective products to market and safeguard well-paying jobs. In fact, AMC members — many of which are small and medium-sized enterprises in rural Canada — have been forced to find alternative methods of transport at very significant expense rather than investing those funds in innovation. These global challenges have and will continue to increase the costs of doing business and drive inflation.The federal budget focused on investments to ensure resilient supply chains, including $450 million over five years for supply chain projects under the National Trade Corridors Fund. It also invested in developing industry-driven solutions to use data to make our supply chains more efficient and to continue making Canada's supply chains more competitive by cutting red tape. The government has also created a National Supply Chain Task Force to address these important issues. These are all good starts, but concrete actions must be taken to ensure results. This means money out the door and shovels in the ground.Renewing and expanding infrastructure projects that reduce bottlenecks and other disincentives to business is essential. This includes high-speed rail, modern ports and better highways. In addition to providing jobs and regional and local economic benefits during construction, better infrastructure is the key to long-term expansion of production, more sales and the competitive development of export markets.When it comes to addressing labour shortages, more support is needed to incentivize young Canadians to choose agricultural manufacturing as a first-choice career through training programs, in addition to making it easier for rural employers to attract and retain talent. While the agricultural equipment manufacturing sector currently employs more than 25,000 Canadians in well-paying middle-class jobs in communities across the country, vacancies remain at an all-time high. The ability to secure enough talent is impeding the ability of these innovative businesses to capitalize on current market conditions and expand operations.The federal government has committed to increasing the number of immigrants into the country at a rate of about one per cent of Canada's population. As the government notes, with five million Canadians set to retire by the end of this decade, the need for increased immigrants is more apparent than ever to address the dire labour shortage in the agricultural manufacturing sector, let alone dozens of others.We know, however, that while skilled immigrants are coming to Canada in an effort to meet the country's labour market needs, jobs remain vacant while qualified people lack opportunities for retraining, and little support to relocate to rural areas — resulting in highly qualified and experienced people remaining unemployed or underemployed.“This disconnect between labour demand and supply in certain sectors is due in part to the failure to recognize the foreign qualifications of newcomers to Canada in an efficient and fair manner,” notes a report from the Library of Parliament.Additionally, rural employers need incentives to attract skilled workers to their businesses such as providing increased moving allowances that are easily deductible and do not produce an administrative burden on either the employer or the individual.Given the magnitude of the challenge before us, the solution requires a coordinated government approach that attracts skilled labour, promotes training and encourages Canadian agricultural manufacturing as a career pathway, especially in rural Canadian communities.The continued success of Canada's agricultural equipment manufacturing sector depends on its workforce — from engineering, finance and high-tech workers to those developing innovative IP and the skilled workers manufacturing products that help to reduce carbon and feed the world.Canada's unique agricultural manufacturing sector contributes significantly to national economic output — generating more than $2.8 billion of exports to 153 countries around the world. This success requires access to export markets through enhanced infrastructure and uninterrupted supply chains and a skilled workforce. This resilient and innovative sector is one we should all be proud of as Canadians. As our country galvanizes toward economic recovery and sustainability, it is imperative that agricultural manufacturers continue to be at the forefront of success here at home and abroad.Donna Boyd is the president of Agricultural Manufacturers of Canada.