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Capital expenditures on machinery and equipment decreased almost 5% in 2013


Ottawa – Public and private organizations reported $256.0 billion in total capital expenditures on non-residential construction and machinery and equipment in 2013, up 2.7% from 2012, Statistics Canada reports. The increase was attributable to a 6.5% gain in capital expenditures on non-residential construction. Conversely, capital expenditures on machinery and equipment decreased 4.9% to $78.0 billion.

Strong increases in capital expenditure were reported in the transportation and warehousing sector, mining, quarrying, and oil and gas sector and utilities.

Total capital spending by private sector organizations rose 5.0% to $183.4 billion, while total capital spending by the public sector declined 2.5% to $72.6 billion.

In 2013, capital expenditures made on intellectual property products totalled $17.2 billion. (Intellectual property products relate to software, exploration drilling, mineral exploration and geological, geophysical and other exploration and evaluation costs.)

Provinces and territories summary

In 2013, capital expenditures on non-residential construction and machinery and equipment rose in four provinces and every territory. Provincially, increases occurred in Alberta, Saskatchewan, Newfoundland and Labrador, and Prince Edward Island.

Alberta reported the largest increase, with capital expenditures up 16.6% to $91.7 billion, mainly as a result of higher capital spending in the oil and gas extraction subsector.

Capital expenditures rose 12.4% to $18.2 billion in Saskatchewan, where spending in the mining and quarrying subsector increased by $788 million to $4.9 billion, and spending in the oil and gas extraction subsector was up $605 million to $4.9 billion.

In Newfoundland and Labrador, capital expenditures on non-residential construction and machinery and equipment rose 22.5% to $8.1 billion as a result of increased spending in the oil and gas extraction subsector. Capital spending for this subsector advanced $1.4 billion to $3.2 billion.

Capital expenditures in Ontario declined 9.4% to $57.0 billion, largely attributable to a $1.3 billion decrease in the mining, quarrying, and oil and gas extraction sector.

In British Columbia, capital spending declined 8.2% to just under $25.7 billion. The decline was attributable to a drop in capital spending by the public administration sector.

Industry perspective

Strong increases in capital spending were reported in a number of sectors, with the transportation and warehousing sector contributing the most to the overall growth in 2013. Spending in this sector was up $6.2 billion to $24.4 billion, largely as a result of higher capital spending on pipeline transportation and support activities for transportation.

Capital expenditures on non-residential construction and machinery and equipment by the mining, quarrying, and oil and gas extraction sector increased 7.1% to $83.9 billion, largely as a result of gains in the oil and gas extraction subsector, which increased $6.3 billion to $65.1 billion. This strong increase offset the decline in the mining and quarrying subsector in 2013.

Capital spending on the utilities sector was up 13.9% to $29.6 billion. Large increases in the electric power generation, transmission and distribution subsector offset the declines in the natural gas distribution (-24.1%) and the water, sewage and other systems (-7.0%) subsectors.

Capital spending fell by 10.8% in the educational services sector and by 5.9% in the public administration sector.

Capital expenditures on intellectual property products

In 2013, capital expenditures on exploration drilling totalled $5.5 billion. Geological, geophysical and other exploration costs and evaluation costs were $1.1 billion, while spending in mineral exploration reached $2.4 billion.

Provincially, Alberta accounted for almost half (48.9%) of the expenses on mineral exploration and evaluation, while British Columbia accounted for 15.8%, Saskatchewan 8.4%, and Newfoundland and Labrador 8.1%.

Software expenditures totalled $8.3 billion in 2013. Ontario (45.0%) accounted for the largest share, followed by Quebec (18.9%).


Bill Roebuck

Bill Roebuck

Bill Roebuck is the Editor and Associate Publisher of Machinery & Equipment MRO magazine and mromagazine.com.
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