Canadian Occupational Projection System (COPS)

Industrial Summary

Plastics and Rubber Products

NAICS 3261-3262

This industry comprises establishments primarily engaged in making goods by processing raw rubber (such as tires and inner tubes, hoses and belts, shoe and boot parts, latex products) and plastics materials (such as plastic resins, plastic packaging, polystyrene and urethane foam, plastic pipes, plastic bottles). Plastics are the largest of the two segments, accounting for 85% of production in 2016. Overall, close to half of the industry’s production is exported. The two segments, however, do not face the same degree of exposure to domestic and foreign economic conditions. Plastics are largely dependent on domestic demand, with 60% of production sold within the country. In contrast, rubber products are far more sensitive to foreign demand, with exports accounting for 72% of production, 93% of which are shipped to the United States. The industry employed 91,000 workers in 2016 (5.4% of total manufacturing employment), with 82% in plastics and 18% in rubber products. Employment is mostly concentrated in Ontario (46%) and Quebec (33%), and the workforce is largely composed of men (68%). Key occupations (4-digit NOC) include:

  • Plastics processing machine operators (9422)
  • Plastic products assemblers, finishers and inspectors (9535)
  • Supervisors, plastic and rubber products manufacturing (9214)
  • Labourers in rubber and plastic products manufacturing (9615)
  • Rubber processing machine operators and related workers (9423)
  • Chemical engineers (2134)

* Key occupations for manufacturing industries in general also include: Manufacturing managers (0911); Construction millwrights and industrial mechanics (7311); Material handlers (7452); Shippers and receivers (1521); Transport truck drivers (7511); Industrial engineering and manufacturing technologists and technicians (2233); Industrial electricians (7242); and Industrial and manufacturing engineers (2141).

Demand for plastics and rubber products is heavily tied to the North American manufacturing supply chain, making it particularly sensitive to business cycles. The industry was already struggling before being hit further by the effects of the global recession of 2008-2009. After reaching a peak in 2005, production declined by 30% in the following four years. Underpinned by the recovery in manufacturing and housing activity in Canada and the United States, output increased back from 2010 to 2016, progressively returning to its pre-recession level. The resulting pace of growth in real GDP averaged 0.1% annually over the period 2007-2016. Employment growth was particularly slugglish over the last ten years, even when output recovered between 2010 and 2016. On average, employment declined by 3.5% per year from 2007 to 2016, reflecting significant gains in productivity attributable to further automation of the production process and the adoption of more advanced technologies such as 3D printing.

Over the projection period, renewed growth in the industry is expected to be primarily driven by the straightening anticipated in manufacturing activity and stronger exports, spurred by a relatively low Canadian dollar and a recovering U.S. demand for new housing and motor vehicles. The growing middle class in large markets such as China and India is also expected to increase demand for automobiles and airplanes, which are major users of plastic and rubber parts. Major restructuring undergone in the past decade has enabled the industry to become a major force in global markets and this welcome development should help to increase exports to emerging markets. Furthermore, technological developments have led to growing demand for plastics as a subtitute for metals. For example, plastics are now being use more intensively in electronics, while efforts to reduce vehicle weight will continue to support greater use of plastics in automotive (which are lighter than traditional metal parts). The global biosplastic market also provides new opportunities for manufacturer to move away from petroleum-based plastics. On the negative side, the recycling rate for plastics is far below the rates for paper, iron and steel and since most plastic packaging is single-use, the industry is likely to face restrictions such as bans on plastic bags. The muted outlook for new housing activity in Canada is also expected to restrain growth in the industry, while the renegotiations of the North American Free Trade Agreement (NAFTA) represent a downside risk to the export outlook. Nevertheless, real GDP growth in the industry is projected to return to positive territory over the period 2017-2026, averaging 2.3% annually. Renewed growth in production is expected to result in a modest rebound in employment, with job creation averaging 0.9 per year. However, a significant part of production growth is expected to be met by additional gains in productivity resulting from further adoption of advanced manufacturing technologies.

Real GDP and Employment Growth Rates in Plastics and Rubber Products

Figure showing the annual growth of real GDP and employment over the periods 2007-2016 and 2017-2026 for the industry of Plastics and Rubber Products. The data is shown on the table following this figure

Source: Statistics Canada (historical) and ESDC 2017 COPS industrial scenario (projections).

Text Version of Figure Real GDP and Employment Growth Rates in Plastics and Rubber Products, 2007-2016 and 2017-2026, in Percent
  Real GDP Employment
2007-2016 0.1 -3.5
2017-2026 2.3 0.9

Source: Statistics Canada (historical) and ESDC 2017 COPS industrial scenario (projections).

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