OTTAWA, Ont. — Weak economic growth is slowing demand for air, truck, rail and water transportation, but industry profitability will rise by 30% this year to $6 billion thanks to better cost control and rising transportation prices.
That’s the assessment of the Conference Board of Canada and the Business Development Bank of Canada, which just published their latest Canadian Industrial Profile report.
The paper warns a weak economic outlook and cautious consumers will leave many Canadian industries with no significant growth in 2013. Transportation and warehousing is the rare exception, with price increases and cost control practices driving strong profit growth going forward, according to the report.
“Canada is not immune to the economic uncertainty that has weakened global demand for goods and services. Modest employment growth is limiting Canadians’ income gains. Consumer confidence remains weak and household debt continues to mount – all of which dampen the willingness of shoppers to spend on retail items, food and drink, dining out and travel,” said Michael Burt, director, industrial economic trends at the Conference Board of Canada.
“In the current business environment, characterized by strong competitive pressures, small and medium-sized businesses who invest in information technology will be better equipped to navigate the challenging economic times ahead,” added Pierre Cleroux, vice-president and chief economist, BDC.