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Monthly Survey of Manufacturing

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November 2008 (Previous release)

Manufacturing sales decreased for a fourth consecutive month in November. Sales fell 6.4% to $48.4 billion, the lowest level since December 2004.

Constant dollar manufacturing sales, which are measured in 2002 prices, fell to their lowest level in almost 10 years, decreasing by 3.0% in November. Therefore, about half of the drop in the current dollar series compared with October reflected price declines. The most significant price decreases were in the petroleum and coal industry (-18.5%) and primary metal industry (-6.0%).

At the industry level, sales in 12 of 21 manufacturing industries decreased in November, accounting for over four-fifths of total sales.

Chart 1

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The five largest manufacturing industries in Canada report decreases

November sales were down in the five largest industries, led by a 20.6% drop by petroleum and coal product manufacturers. Petroleum and coal product sales have fallen for five consecutive months. Sales have decreased by almost $3 billion compared with the peak of $8.2 billion reached in June 2008. Falling prices were the most significant factor in explaining the lower value of sales in November.

Primary metal manufacturers also reported significantly lower sales, down 17.4% to $4.1 billion. Sales in November were at the lowest level since March 2006, as both falling prices and deteriorating global demand negatively influenced the value of sales.

Sales in the transportation equipment industry decreased 3.9% in November. Aerospace products and parts production pulled back 22.5%, after a 27.2% gain in October. This was the first production decrease in the aerospace industry since August.

Note to readers

All data in this release are seasonally adjusted and are expressed in current dollars unless otherwise specified.

Preliminary estimates are provided for the current reference month. Estimates, based on late responses, are revised for the three previous months.

Non-durable goods industries include food, beverage and tobacco products, textile mills, textile product mills, clothing, leather and allied products, paper, printing and related support activities, petroleum and coal products, chemicals, and plastics and rubber products.

Durable goods industries include wood products, non-metallic mineral products, primary metals, fabricated metal products, machinery, computer and electronic products, electrical equipment, appliances and components, transportation equipment, furniture and related products and miscellaneous manufacturing.

Production-based industries

For the aerospace industry and shipbuilding industries, the value of production is used instead of sales of goods manufactured. This value is calculated by adjusting monthly sales of goods manufactured by the monthly change in inventories of goods in process and finished products manufactured.

Unfilled orders are a stock of orders that will contribute to future sales assuming that the orders are not cancelled.

New orders are those received whether sold in the current month or not. New orders are measured as the sum of sales for the current month plus the change in unfilled orders from the previous month to the current month.

In November, chemical product manufacturers posted an 8.7% drop in sales, which was largely due to the resin, synthetic rubber, and artificial and synthetic fibres and filaments industry.

Sales decline in all provinces

Every province reported decreased manufacturing sales in November, ranging from a 0.3% decline in Saskatchewan to a 31.5% drop in New Brunswick. In the Atlantic provinces as a whole, manufacturing sales were down 21.7%, reflecting a sizeable decline in petroleum product prices.

Manufacturing sales fell by 7.6% in Quebec, erasing the 3.6% rise in October. The drop in sales for November was mainly due to declines in the primary metal and aerospace manufacturing industries.

Ontario's manufacturing sales declined 3.9%, the fourth consecutive monthly decrease. Petroleum and coal product sales fell by 20.1%, reflecting the drop in petroleum prices. Primary metal manufacturing for the province declined by 16.2% compared with October.

The decline in Alberta's manufacturing sales steepened in November. Sales fell 8.8%, following a 6.2% drop in October. The chemical product industry (-31.7%) was the leading cause of decreased provincial sales. In addition, petroleum and coal products sales fell by 15.2%.

Sales in British Columbia decreased by 3.6%, primarily due to declines in the wood and paper product industries.

Table 1

Manufacturing sales, provinces and territories
  October 2008r November 2008p October to November 2008
  Seasonally adjusted
  $ millions % change1
Canada 51,707 48,414 -6.4
Newfoundland and Labrador 524 411 -21.5
Prince Edward Island 113 106 -6.0
Nova Scotia 912 845 -7.4
New Brunswick 1,524 1,044 -31.5
Quebec 13,351 12,334 -7.6
Ontario 23,403 22,492 -3.9
Manitoba 1,414 1,370 -3.1
Saskatchewan 1,048 1,044 -0.3
Alberta 6,012 5,484 -8.8
British Columbia 3,400 3,278 -3.6
Yukon 3 3 -0.8
Northwest Territories and Nunavut 2 2 -11.0
revised
preliminary
Percent change calculated at thousands of dollars.

Inventory levels move downward

Inventory levels pulled back 0.6% in November to $68.3 billion, the second decrease in nine months.

Petroleum and coal product inventories declined 9.8%, and primary metal manufacturers reported a 2.7% drop. Price decreases were a significant factor in the lower value of inventory in both cases. Offsetting these declines were increases of 4.6% in computers and electronics and 2.5% in aerospace products and parts.

Chart 2

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The inventory-to-sales ratio increased to 1.41 in November, the highest level since January 2002. This eight-point jump was the largest month-to-month gain since June 1998, moving the ratio well above its three-year average of 1.30. The inventory-to-sales ratio is a measure of the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.

Chart 3

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Unfilled orders rose 0.8% in November for the sixth gain in seven months. Aerospace products and parts increased 2.7% after a 14.1% gain in October. Fabricated metal products partially offset this advance with a decline of 3.8%, the second decrease in three months. Excluding the aerospace industry, unfilled orders decreased 1.4% in November.

For the first time since April 2008, new orders fell below $50 billion, dropping 12.9% in November to $49.0 billion. The aerospace industry accounted for half of this decline, with new orders down $4.1 billion.

Chart 4

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Available on CANSIM: tables 304-0014, 304-0015 and 377-0008.

Definitions, data sources and methods: survey number 2101.

Data from the December Monthly Survey of Manufacturing will be released on February 16.

For more information, or to order data, contact the dissemination officer (toll-free 1-866-873-8789; 613-951-9497; fax: 613-951-3877; manufact@statcan.gc.ca). To enquire about the concepts, methods or data quality of the release, contact Elton Cryderman (613-951-4317; elton.cryderman@statcan.gc.ca), Manufacturing and Energy Division.

Table 2

Sales, inventories and orders in all manufacturing industries
  Sales Inventories Unfilled orders New orders Inventory-to-sales ratio
  Seasonally adjusted
  $ millions % change $ millions % change $ millions % change $ millions % change  
November 2007 50,569 1.6 65,154 0.6 57,005 4.5 53,034 8.2 1.29
December 2007 48,535 -4.0 64,854 -0.5 58,530 2.7 50,060 -5.6 1.34
January 2008 48,999 1.0 65,220 0.6 58,857 0.6 49,326 -1.5 1.33
February 2008 50,211 2.5 64,679 -0.8 58,733 -0.2 50,088 1.5 1.29
March 2008 49,326 -1.8 65,026 0.5 61,753 5.1 52,346 4.5 1.32
April 2008 50,102 1.6 65,240 0.3 61,306 -0.7 49,655 -5.1 1.30
May 2008 51,509 2.8 66,389 1.8 62,866 2.5 53,069 6.9 1.29
June 2008 52,646 2.2 67,046 1.0 63,903 1.6 53,683 1.2 1.27
July 2008 53,998 2.6 67,243 0.3 64,564 1.0 54,660 1.8 1.25
August 2008 51,873 -3.9 67,682 0.7 66,493 3.0 53,802 -1.6 1.30
September 2008 51,819 -0.1 67,618 -0.1 66,145 -0.5 51,470 -4.3 1.30
October 2008 51,707 -0.2 68,749 1.7 70,702 6.9 56,264 9.3 1.33
November 2008 48,414 -6.4 68,330 -0.6 71,296 0.8 49,008 -12.9 1.41

Table 3

Manufacturing industries except motor vehicle, parts and accessories
  Sales Inventories Unfilled orders New orders
  Seasonally adjusted
  $ millions % change $ millions % change $ millions % change $ millions % change
November 2007 43,281 1.8 62,513 0.8 56,378 4.6 45,747 9.6
December 2007 42,914 -0.8 62,305 -0.3 57,810 2.5 44,346 -3.1
January 2008 43,283 0.9 62,580 0.4 58,162 0.6 43,635 -1.6
February 2008 43,889 1.4 62,055 -0.8 57,955 -0.4 43,682 0.1
March 2008 43,496 -0.9 62,425 0.6 60,896 5.1 46,437 6.3
April 2008 44,288 1.8 62,669 0.4 60,325 -0.9 43,717 -5.9
May 2008 45,625 3.0 63,753 1.7 61,763 2.4 47,062 7.7
June 2008 46,579 2.1 64,529 1.2 62,769 1.6 47,586 1.1
July 2008 47,763 2.5 64,644 0.2 63,459 1.1 48,453 1.8
August 2008 46,100 -3.5 65,190 0.8 65,468 3.2 48,109 -0.7
September 2008 46,115 0.0 65,256 0.1 65,242 -0.3 45,889 -4.6
October 2008 46,215 0.2 66,228 1.5 70,037 7.3 51,009 11.2
November 2008 42,837 -7.3 65,834 -0.6 70,649 0.9 43,449 -14.8