MRO Magazine

Manufacturing output declined in January after rising in December

GDP Jan15Ottawa – Real gross domestic product edged down 0.1% in January 2015 after increasing 0.3% in December and declining 0.2% in November, Statistics Canada reports.

The output of service industries decreased 0.3% in January, the first decline since February 2014. The decline was primarily due to decreases in wholesale and retail trade and, to a lesser extent, in transportation and warehousing services as well as accommodation and food services. In contrast, professional services and the finance and insurance sector increased. The public sector (education, health and public administration combined) edged up.

Goods production rose 0.3% in January, following a 0.4% gain in December, primarily as a result of increases in oil and gas extraction, utilities and the agriculture and forestry sector. These gains were partly offset by declines in manufacturing and, to a lesser extent, construction.

Wholesale and retail trade decline


Wholesale trade fell 2.6% in January after rising 1.8% in December. The wholesaling of building materials and supplies as well as of motor vehicle and parts were major contributors to January’s decline. The activities of miscellaneous wholesalers (which include agricultural supplies) and machinery, equipment and supplies wholesalers were also down.

Retail trade decreased 1.0% in January, a second monthly decline. Notable decreases occurred in food and beverage stores, sporting goods, hobby, book and music stores and motor vehicle and parts dealers. In contrast, retailing activities at clothing and clothing accessories stores as well as gasoline stations were up.

Mining, quarrying, and oil and gas extraction rises

Mining, quarrying, and oil and gas extraction rose 1.4% in January, after declining 0.9% in December, mainly because of an increase in non-conventional oil extraction.

Following a 2.1% decline in December, oil and gas extraction increased 2.6% in January. Non-conventional oil extraction posted a notable gain, following two consecutive monthly declines, as production rose following maintenance in the fourth quarter at some oil sands facilities. However, both conventional crude petroleum and natural gas extraction were down in January.

Support activities for mining and oil and gas extraction fell 2.0% in January, as a result of declines in rigging services. Crude oil prices fell sharply in January and have been declining since July 2014. Natural gas prices were also down in January, their fifth decline since August 2014.

Mining and quarrying (excluding oil and gas extraction) decreased 0.4% in January. Declines in metallic mineral and coal mining more than offset increases in potash mining.

Manufacturing output declines

Manufacturing output declined 0.7% in January after rising 2.1% in December.

Durable-goods manufacturing decreased 0.7% in January. Declines were recorded in the manufacturing of machinery and transportation equipment. On the other hand, increases were posted in the manufacturing of non-metallic mineral products, computer and electronic products and fabricated metal products.

Non-durable goods manufacturing decreased 0.7% in January, mainly a result of notable declines in chemical as well as plastic and rubber products manufacturing. Conversely, there were increases in beverage and tobacco manufacturing.

Construction falls

Construction fell 0.4% in January. Both residential and non-residential building construction were down, while engineering construction was up.

The output of real estate agents and brokers decreased 5.7% in January, a fifth consecutive monthly decline. The decline was mainly the result of weakness in the home resale market in Alberta and Saskatchewan.

The finance and insurance sector is up

The finance and insurance sector was up 0.2% in January following a 1.3% gain in December. Both banking and insurance services increased while financial investment services declined.

Other industries

Utilities increased 1.4% in January, as a result of gains in electricity generation, transmission and distribution as well as natural gas distribution.

The public sector (education, health and public administration combined) edged up 0.1%.

The agriculture and forestry sector was up 1.9% in January, as crop and animal production and the forestry sector grew.