Canadian industries operated at 82.9% of their production capacity in Q4, up from 81.7% in Q3; increase driven by gains in construction and manufacturing sectors, particularly transportation equipment manufacturing: Statistics Canada

Sample article from our Housing & Economy

OTTAWA , March 11, 2022 (press release) –

Canadian industries operated at 82.9% of their production capacity in the fourth quarter of 2021, up from 81.7% in the third quarter.

The increase in the fourth quarter was mainly driven by gains in the manufacturing sector—specifically, transportation equipment manufacturing—and in the construction sector.

A recovery in construction

Chart 1: Industrial capacity utilization in non-manufacturing industries

Chart 1: Industrial capacity utilization in non-manufacturing industries

Following a decline in the third quarter, capacity utilization in construction rose 1.2 percentage points to 92.6% in the fourth quarter. Investment in building construction grew (+1.8%) during the fourth quarter, primarily because of a strong rise in non-residential building construction (+4.1%). Increased activity was observed in engineering and other construction activities (+3.7%). According to the Labour Force Survey, employment in construction rose from 1.42 million in the third quarter to 1.44 million in the fourth quarter.

Capacity utilization in the mining and quarrying subsector (except oil and gas) was up 1.7 percentage points to 87.5% in the fourth quarter. This increase was mainly fuelled by higher levels of activity in support activities for the mining subsector (+28.6%).

A recovery in capacity utilization in manufacturing
Year over year, the capacity utilization rate in the manufacturing sector edged up 0.3 percentage points to 76.9% in the fourth quarter. This increase was driven by recovering activities in the manufacturing sector in the fourth quarter. According to the Labour Force Survey, employment in manufacturing rose from 1.72 million in the third quarter to 1.75 million in the fourth quarter. Year over year, capacity utilization increased in 13 of the 21 major manufacturing industry groups, representing approximately 60% of gross domestic product in the manufacturing sector in the fourth quarter.

Chart 2: Year-over-year change by industry, fourth quarter 2021 compared with the fourth quarter 2020

Chart 2: Year-over-year change by industry, fourth quarter 2021 compared with the fourth quarter 2020  

After three quarters of decline because of the semiconductor chip shortage, transportation equipment manufacturing saw its first increase in the capacity utilization rate, up to 70.5% in the fourth quarter. Higher levels of activity were observed in motor vehicle manufacturing (+23.9%). That rise coincided with an increase in exports (+15.9%) and imports (+12.5%) of motor vehicles and parts in the fourth quarter. However, this transportation and equipment manufacturing capacity utilization rate is still well below what was recorded in the fourth quarter of 2020 (81.1%), resulting in a year-over-year decline of 10.6 percentage points.

The year 2021 in review
Following a decline in 2020 (-4.3 percentage points), the industrial capacity utilization rate rose 4.6 percentage points to 82.1% in 2021.

In the mining and quarrying subsector (except oil and gas), it rose 16.0 percentage points to 83.2% in 2021. Higher levels of activity were particularly seen in the metal ore subsector (+22.2%) and in the support activities for mining, and oil and gas extraction subsector (+34.4%).

The construction sector experienced a capacity utilization rate increase of 5.4 percentage points to 93.3% in 2021. The gain was driven by higher levels of activity in residential building construction (+13.0%). According to the Building Permits Survey, residential construction posted a strong annual increase (+28.8%). Residential construction was buoyed by low mortgage rates.

The manufacturing sector experienced an increase in the capacity utilization rate, up 3.8 percentage points to 76.3% in 2021. Capacity utilization saw annual growth in 19 of the 21 major industry groups.

Among the industries that contributed to the increase in total manufacturing, petroleum and coal product manufacturers rose 9.1 percentage points of its capacity utilization rate to 83.5%. A gradual increase in travel activity contributed to the rise in demand for transportation fuels.

Among transportation equipment manufacturers, the annual capacity utilization rate fell 0.6 percentage points to 69.3% as the industry continued to be affected by the semiconductor chip shortage.

Note to readers
The industrial capacity utilization rate is the ratio of an industry's actual output to its estimated potential output.

This program covers all manufacturing industries, forestry and logging, mining, quarrying, and oil and gas extraction, electric power generation, transmission and distribution, and construction.

For non-manufacturing industries, the quarterly pattern is derived from the output-to-capital ratio series, the output being the real gross domestic product at basic prices, seasonally adjusted, by industry.

For this release on industrial capacity utilization rates, the data were revised back to the first quarter of 2021 to reflect the latest revisions to the source data. For manufacturing industries, the data are not seasonally adjusted, as the new survey source (Monthly survey of manufacturing) does not have a long enough time period to perform a seasonal adjustment.

Next release
Data on industrial capacity utilization rates for the first quarter of 2022 will be released on June 13, 2022.

Products
The data visualization product "Overview of the industrial capacity utilization rate: Interactive tool," which is part of the Statistics Canada — Data Visualization Products series (Catalogue number71-607-X), is now available.

The Economic accounts statistics portal, accessible from the Subjects module of the Statistics Canada website, features an up-to-date portrait of national and provincial economies and their structure.

The Latest Developments in the Canadian Economic Accounts (Catalogue number13-605-X) is available.

The User Guide: Canadian System of Macroeconomic Accounts (Catalogue number13-606-G) is available.

The Methodological Guide: Canadian System of Macroeconomic Accounts (Catalogue number13-607-X) is available.

Contact information
For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; infostats@statcan.gc.ca) or Media Relations (statcan.mediahotline-ligneinfomedias.statcan@statcan.gc.ca).

Industry Intelligence Editor's Note: This press release omits select charts and/or marketing language for editorial clarity. Click here to view the full report.

* All content is copyrighted by Industry Intelligence, or the original respective author or source. You may not recirculate, redistrubte or publish the analysis and presentation included in the service without Industry Intelligence's prior written consent. Please review our terms of use.

More from our Housing & Economy Coverage
See our dashboard in action - schedule an demo
Jason Irving
Jason Irving
- SVP Enterprise Solutions -

We offer built-to-order housing & economy coverage for our clients. Contact us for a free consultation.

About Us

We deliver market news & information relevant to your business.

We monitor all your market drivers.

We aggregate, curate, filter and map your specific needs.

We deliver the right information to the right person at the right time.

Our Contacts

1990 S Bundy Dr. Suite #380,
Los Angeles, CA 90025

+1 (310) 553 0008

About Cookies On This Site

We collect data, including through use of cookies and similar technology ("cookies") that enchance the online experience. By clicking "I agree", you agree to our cookies, agree to bound by our Terms of Use, and acknowledge our Privacy Policy. For more information on our data practices and how to exercise your privacy rights, please see our Privacy Policy.