Review of Economic Statistics — November 16, 2018 - Transcript
(The Statistics Canada symbol and Canada wordmark appear on screen with the title: "Review of Economic Statistics — November 16, 2018")
(Background music plays while title card with the text "Review of Economic Statistics" appears on screen.)
Richard Evans: Welcome to the Review of Economic Statistics. I'm Richard Evans.
Guy Gellatly: I'm Guy Gellatly.
(Text on screen below presenters: "Richard Evans, Director General, Industry Statistics. Guy Gellatly, Principal Researcher.")
Richard Evans: Guy, we're looking at two really interesting reports today: one of them we're very familiar with— the manufacturing report— and one we've looked at less often—the New Housing Price Index. Start with manufacturing. If we look at the third quarter, July was strong. August was down slightly. What happened in September?
Guy Gellatly: Richard, overall manufacturing sales up 0.2% in September, and that's really led by higher sales in auto manufacturers. And that follows those atypical shutdowns at some assembly plants that we had in August, as production bounced back in September.
(Text on screen below presenters: "Manufacturing sales edged up 0.2% in September on higher sales at auto plants.")
Richard Evans: Yeah, so a big bounce-back there. I understand it was a significant bounce back. Why did we have higher sales growth overall then?
Guy Gellatly: You know, some offsetting movements, certainly in the September numbers, we had lower machinery sales. They were down, actually, after being up for four consecutive months in September. We also had lower sales of wood products in the September report.
Richard Evans: Alright, so let's look at the quarterly number now. What happened for the quarter as a whole?
Guy Gellatly: Well, you know, a solid quarter overall in terms of manufacturing sales. Manufacturing sales up 2% in the third quarter, and that's the fourth consecutive quarterly gain that we've had in those numbers.
(Text on screen below presenters: "Posting the fourth consecutive quarterly gain, manufacturing sale rose 2.0% in the third quarter of 2018.")
Richard Evans: Any price effects there?
Guy Gellatly: Some support certainly from prices. But we also had kind of a volume movement of 1.4%. So, if you look at the sales volumes, kind of that measure of real activity…
Richard Evans: Yes.
Guy Gellatly: … they were up pretty substantially for the quarter.
Richard Evans: So it was mostly volumes? Good. So, this volume price distinction, let's talk prices some more, and then the housing context, the New Housing Price Index. That's a measure of new homes that have been just built and sold for the first time. It doesn't include the resale component. What is that showing for September?
Guy Gellatly: Well, it's interesting, Richard. First, we'll look for Canada as a whole. We'll look at those price movements on a year-over-year basis, and we really have seen a moderation in new house prices through 2018 to date. . So, if you look at the September number, new house prices in September basically unchanged from where they were in September of 2017. They're up slightly, so 0.2%.
Richard Evans: So, quiet? Nationally speaking? When we look under the hood and look at certain cities, what are you seeing there?
Guy Gellatly: Yeah, it's interesting there, and there's some notable movements in terms of the large urban markets of Toronto and Vancouver. So, for Toronto, again looking on a year-over-year basis, you've seen declines over the last six months. So, prices in Toronto down 1.2% in September from where they were a year ago.
(Text on screen below presenters: "New house prices measured on a year-over-year basis edged up 0.2% at the national level in September.")
Guy Gellatly: And in the case of Vancouver, you've seen a slower pace of price growth. That's really sort of decelerated, and although they're still up…
Richard Evans: They're still up year over year but by less.
Guy Gellatly: Yeah, 0.6% higher in September of this year than they were in September of 2017, in Vancouver.
Richard Evans: Now, I understand that's not been the trend in Montréal.
Guy Gellatly: Yeah, different story in Montréal. Obviously, we've seen some acceleration in new house prices in that city. So, in September, they were 3% higher than they were a year ago.
Richard Evans: Alright, so if I attempt to sum up: manufacturing up slightly in September, but up more significantly in the third quarter as a whole, and a continuing of that moderating trend we've seen throughout 2018 in new house prices. Is that right?
Guy Gellatly: That is correct.
Richard Evans: Awesome. For those of you that want to know more about manufacturing, we've just published a very interesting new study that looks at the productivity performance of the more productive firms, on the one hand, and the less productive firms, on the other hand. There are some interesting differences, and they're all outlined in this new article, which is titled Long-run Productivity Dispersion in Canadian Manufacturing. You'll find it on our website. I also invite you to tune in, in two weeks' time, to listen to us talk about the third-quarter GDP.
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