Canadian Occupational Projection System (COPS)

Industrial Summary

Computer, Electronic and Electrical Products

NAICS 3341-3346; 3351-3359

This industry comprises establishments primarily engaged in manufacturing information and communication technology (ICT) devices, such as computers and peripherals, telecommunication and audio-video equipment, navigational and measuring instruments, as well as electronic components for such products. It also comprises establishments involved in manufacturing products that generate, distribute and use electrical power, such as generators, transformers, switchgears, batteries, wires, electrical motors and household appliances. ICT is the most important of the two segments, accounting for about two-thirds of production in 2016. Overall, the industry is highly export intensive, with about 75% of its revenues coming from abroad, largely from the United States which account for 70% of exports. The industry is also largely exposed to import penetration with a substantial share of domestic demand met by imports, mainly from the United States, China and Mexico. It employed 106,600 workers in 2016 (6.3% of total manufacturing employment), with 63% in the ICT segment. Employment is mostly concentrated in Ontario (49%) and Quebec (29%), and the workforce is predominantly composed of men (73%). Key occupations (4-digit NOC) include:

  • Electronics assemblers, fabricators, inspectors and testers (9523)
  • Assemblers and inspectors, electrical appliance, apparatus and equipment manufacturing (9524)
  • Electrical and electronics engineers (2133)
  • Supervisors, electronics manufacturing (9222)
  • Supervisors, electrical products manufacturing (9223)
  • Machine operators and inspectors, electrical apparatus manufacturing (9527)
  • Computer programmers and interactive media developers (2174)
  • Electrical and electronics engineering technologists and technicians (2241)

* 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).

While the industry posted impressive growth in the late 1990s, largely driven by the strong performance of the ICT segment, production and employment fell almost continuously after the dot-com bubble burst of 2001. This reflects various challenges faced by the industry during that period, including the market saturation for ICT products in the early 2000s (largely due to an over capacity in the telecommunications infrastructure); the global recession of 2008-2009; the strong appreciation of the Canadian dollar (prior to 2013); and most importantly, the intensification of international competition on both domestic and foreign markets. Canada’s market share in the United States has been declining since the the early 2000s, while imports from China have more than doubled in the last ten years. Producers are increasingly relocating to low-cost countries and China’s market share in Canada has been exceeding that of the United States since 2010 and is now accounting for almost 40% of Canadian imports of ICT products. Sales from the wireless communications segment were particularly affected by BlackBerry’s difficulties and decision to stop making phones, in part because of intense competition from Apple's iPhone and Google's Android. While real GDP in the industry contracted at an annual average rate of 2.6% over the period 2007-2016, the decline in employment was more severe, averaging 3.7% per year and reflecting major restructuring in the industry. However, all of the declines occurred prior to 2014 as production and employment have stabilized in recent years, partly supported by renewed growth in exports of ICT products, most likely as a result of a weaker Canadian dollar.

Over the projection period, production in the industry is expected to pick up, primarily driven by the strengthening anticipated in business investment in North America and growing opportunities brought by new technologies. After posting mitigate growth over the past decade, business investment in machinery and equipment in Canada and the United States is projected to improve significantly, increasing domestic and foreign demand for ICT products which rely heavily on corporate spending. High replacement rates and perpetual innovation for many ICT products are also expected to keep driving consumer interest in new products. New technologies, such as mobile and cloud computing, the Internet of Things (IoT), advanced robotics, machine learning and artificial intelligence, are projected to result in growing global demand for ICT products. With electronics being increasingly embedded in a variety of consumer products, such as autos and appliances, and considering the proliferation of applications for smartphones and other ICT devices, the design and manufacture of sensors and control instruments represent a key source of growth for the industry. The increasing use of new navigational, measuring and medical devices, an area where Canada has a competitive advantage compared with its competitors in developing countries, is also a key factor in the industry’s resurgence. For example, Canada has great potential when it comes to the untapped drone market. On the supply side, domestic firms have easy access to the latest technology and cutting-edge operations available for unmanned aerial vehicle (UAV) sytems. The demand side is promising as well because Canada is a large country with many rural communities and high transportation costs. Finally, the persistent weakness anticipated in the value of the Canadian dollar is expected to support exports, particularly over the short- to medium-term, while a more positive outlook for R&D spending is expected to increase the industry’s capacity to take advantage of emerging opportunities. Over the period 2017-2026, real GDP growth is projected to return to positive territory, averaging 1.7% per year, while employment is projected to keep declining, albeit at a much slower pace than the previous ten years, down by 0.3% annually. Renewed growth in production is expected to be achieved through additional gains in productivity resulting from increased automation within the industry and the shift toward higher value added products.

Real GDP and Employment Growth Rates in Computer, Electronic and Electrical Products

Figure showing the annual growth of real GDP and employment over the periods 2007-2016 and 2017-2026 for the industry of Computer, Electronic and Electrical 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 Computer, Electronic and Electrical Products , 2007-2016 and 2017-2026, in Percent
  Real GDP Employment
2007-2016 -2.6 -3.7
2017-2026 1.2 -0.3

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

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