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					   Moving Forward: Developing the Shipbuilding Sector
It is unclear as to whether Canada can reclaim the prominence it once held as a force in the global shipbuilding
industry. Years of government neglect and the introduction of lopsided free trade agreements have resulted in the
steady erosion of our domestic industry, which has had a disastrous effect on workers from one coast of Canada to
the other. As we continue to equip our fleets using lower-cost foreign produced vessels from countries that reap the
benefit of high subsidies from their governments (such as China and Korea) it becomes increasingly difficult for
Canadian shipbuilders to compete. Further, the proposed trade deal with the European Union may lead to the further
dismantling of this sector. This proposed agreement, supported by the Harper government, would eliminate
favourable public procurement policies; that would cripple the Canadian shipbuilding industry by denying it of its
one reliable customer (government contracts). Therefore, a managed approach to international trade is desperately
needed to ensure that Canadian producers have a fair shot at capturing a good chunk of our own domestic market.
The strategic importance of this industry is far too great for the Canadian government to continue to neglect. A

                                                                                                                                                                    Sector Profile
strong domestic shipbuilding sector is vital to the defence and sovereignty of our nation. We must be able to build
and maintain our aging fleets. Further, revitalizing this sector will help to ensure sovereignty over our waters
including the Arctic. The industry is also crucially important for environmental sustainability of our waters.
Utilising our capacity to build and maintain ships will give a strong presence in Canadian waters which will help                                          SHIPBUILDING
deter pollutants being dumped in our waters, drug imports, and protection of the Arctic.
                                                                                                                                                             SECTOR FACTS AND FIGURES
In order to effectively move forward, it is essential that the federal government play a more active role in promoting
                                                                                                                          Total Sales                                                    $1.4 billion
our shipbuilding industry through both direct and indirect investment and production supports, domestic
                                                                                                                             Change since 2000                                          -$43 million
procurement programs, and the introduction of pro-active industrial policy similar to that established by the United
                                                                                                                          Total GDP (Value-Added, $2002)                                $818 million
States under the Jones Act. Similarly, the Canadian government can follow suit with the U.S. and work to install a
                                                                                                                             Growth since 2000                                             +26%
more favourable investment climate through a reconfigured financing program, as well as working to establish third
party financing arrangements similar to those found in the European Union.                                                Exports                                                       $650 million
                                                                                                                          Imports                                                        $1.2 billion
The industry faces significant opportunities in coming years, thanks to growing demand trend for new or refitted
                                                                                                                          Foreign Trade Balance                                         -$571 million
vessels in various applications across the country, as well as the development of offshore oil and gas development
platforms. Thus it is imperative that the government build on this demand as a springboard for a longer-term              Total Employment                                                  7,582
revitalization program for our shipbuilding industry. A more far-sighted approach would not only ensure a                    Change since 2000                                             -3,129
sustainable future for one of our most prized industries, but will help to secure the livelihoods of thousands of         Greenhouse Gas Emissions (Kilotonnes) 2005                         44
Canadians by triggering long overdue economic development in our hard-pressed coastal communities.                          Change since 2000                                              12.8%
                                                                                                                          Average Hourly Wage (excluding overtime)                         $21.50
                                                                                                                            Real Wage Change since 2000                                     14%
  MAJOR CAW EMPLOYERS                                                      CAW MEMBERS                                    Productivity Growth Since 2000 - 2007                             48%
  Halifax Shipyards                                                                  800                                  Average Work Hrs. / Week (excluding overtime)                     35.6
                                                                                                                          Average Overtime Hrs. / Year                                       68
  Kiewit Offshore Services                                                           600
                                                                                                                          Approximate Unionization Rate                                     70%
  Neptunus Canada Limited                                                             65                                  CAW Members in Sector                                             1500
                                                                                                                          Share of Total CAW Membership                                      1%
                                                                                                                          # CAW Bargaining Units                                              5
                                                                                                                          Average Bargaining Unit Size                                      304
                                                                                                                         SOURCE: Statistics Canada, CAW Research
                                                                                                                         All data for 2008 unless otherwise noted
       Current Conditions                                programs and the future of our domestic shipbuilding
                                                         industry is facing its biggest challenge with the        HOW TO “GREEN” THE SECTOR
The Canadian shipbuilding industry has suffered          Conservative government at the helm.
greatly because of unfair global trade. Canadian firms                                                            •   Improve energy efficiency in
have been forced into cutthroat competition with          The CAW in Shipbuilding                                     shipyard buildings and operations.
foreign companies who receive substantial                                                                         •   Better end-of-life recycling
                                                         The CAW represents approximately 1,500 shipyard
government support through subsidies and trade
                                                         workers, mostly working along Canada’s East Coast.           regulations to recycle materials in
policies (yet our suppliers receive no such aid). The
                                                         The two largest CAW employers in this sector are             retired vessels.
growth of massive shipbuilding infrastructures in
China and Korea, coupled with an unprotected
                                                         the shipyards in Halifax and Marystown. Recently,        •   Invest in Canadian-made vessels
domestic market, resulted in the loss of 3000 more
                                                         the CAW met with the federal government to push              to support low-pollution shipping
                                                         for comprehensive and viable options for a long-             and ferry services.
jobs since 2000. As it stands today, our shipbuilding
                                                         term, sustainable Canadian shipbuilding strategy.
industry employs just over 7,500 Canadians.
                                                         Fleet renewal plans could see the Government invest
Work in this industry has traditionally been generated   in excess of $40 billion to build more than 50 large
on a project-by-project basis, and is subject to the     vessels over the next 30 years. This would potentially
fierce competition of the global market. Although        expand work at the Halifax and Marystown
there has been some growth in new projects over the      shipyards. Currently, many of our shipyards are
past couple of years, the number of imports has          running well under capacity, leaving many of our
substantially grown while exports declined. As           members in this sector out of work.
Canada has continually looked for offshore bargains
when filling our own fleet demands, the sector saw       Shipbuilding workers joined the CAW in 1996
an 11% decline in industry GDP and a $154 million        through a merger with the Marine Workers
loss in sales revenues from 2007 to 2008. This           Federation.
reliance on imported goods over domestic production
pushed our trade deficit to $571 million in 2008 and,
in doing so, pushed many Canadians out of work.
Despite this decline, Canada still boasts one of the
most productive and highest quality shipbuilding
industries in the world. New technologies as well as
organizational structures introduced in previous years
have made Canadian shipyards more efficient. As
indicated by the charts, labour productivity
experienced a sharp increase in recent years.
However, as the industry continues to contract, it is
                                                                    MAJOR SECTOR DEVELOPMENT ISSUES
difficult to foresee any substantial turnaround in         •    Managed international trade in ships: match Canadian jobs with Canadian sales
production without an increase in shipbuilding             •    Add value to Canadian resources: ensure Canadian manufactured content in
capacity through new investment and government                  offshore oil & gas developments
support. There have been efforts in the past years         •    Increase level of government support (both direct and indirect)
such as a boost in public funding through the              •    Re-establish the Shipbuilding and Industrial Marine Advisory Committee (SIMAC)
Structured Financing Facility (SFF) program and the
                                                                to ensure our voices are heard
former Liberal government’s procurement plan to
replace a number of aging naval vessels and Coast          •    Promote Canadian content in shipbuilding through a Buy Canada policy
guard vessels. However, the sustainability of these