- Canadian GDP growth is projected to average only 1.8% until 2029 due to weak job growth, declining energy sector investment, and high household debt. - Canadian manufacturing sales fell 0.8% in October driven by declines in primary metals, petroleum, coal and machinery industries. - The Canadian trade imbalance remains high while housing starts show signs of slowing though prices continue to rise. - The Canadian job market saw part-time jobs increase while full-time jobs declined, contributing to falling inflation-adjusted wages.

1. KEY MARKET AND
INDUSTRY INDICATORS
FOR NORTH AMERICA –
NOVEMBER 2016
BY: PAUL YOUNG, CPA, CGA
DATE – DECEMBER 23, 2016

2. This presentation will look at key market and industry indicators as part on assisting
business as part of their business plans to support their customers.

3. AGENDA
• Overall macro and micro indicators for the economy
• Key industry metrics/statistics

4. ECONOMIC TRENDS (OVERALL)
• GDP Growth Rates
• Canadian Manufacturing Sales
• Canada Trade Imbalance
• Canada Housing Starts
• Canada Employment

5. GDP GROWTH RATES
Source - Scotiabank
• “Finance Canada is giving business leaders a
decidedly gloomy picture of the Canadian
economy as part of the department's pre-
budget consultations this fall.
• A Dec. 5 slide show, obtained by CBC News,
projects weak annual growth of just 1.8 per
cent on average until 2029, and cites full-
time job losses of 1.9 per cent across Canada
so far this calendar year.
• The slide show also notes that productivity
is slowing, energy-sector investment is in
sharp decline, and household indebtedness
is at record levels.
”http://www.cbc.ca/news/politics/finance-
liberals-economy-budget-morneau-
consultations-jobs-1.3883770

6. GDP / CANADA – OCTOBER 2016
Source – Stats Canada

7. GRAPH 1 – CANADA MANUFACTURING
SALES PER DAY
Source – Stats Canada and
http://www.canadianmanufacturing.com/manufacturing/manufacturing-
sales-fell-0-8-per-cent-october-statistics-canada-says-180657/
• Statistics Canada says
manufacturing sales fell 0.8 per
cent to $51.0 billion in October,
including declines in the primary
metal, petroleum and coal
products, and machinery
industries.
• Economists had expected a gain of
0.4 per cent for the month,
according to Thomson Reuters.
• October’s decline followed two
consecutive monthly gains.
• Sales fell in 15 of the 21
industries tracked by Statistics
Canada, representing 61 per cent
of the manufacturing sector
• Durable goods fell 1.1 per cent,
while non-durable goods sales
dropped 0.4 per cent.
• Constant dollar sales fell 1.7 per
cent in October, reflecting a lower
volume of manufactured goods
sold.

8. GRAPH 2 – TRADE IMBALANCE CANADA
Source – Stats Canada

9. GRAPH 3 – HOUSING STARTS (# OF UNITS)
Source – BMO, Reuters and Scotiabank
Canada housing market
shows signs of slowing,
but prices rise`

10. GRAPH #4 – JOB CREATION
Source – Stats Canada
Youth joblessness remains
high at 12.9% and many
new jobs are part time
Source -http://www.cbc.ca/

11. JOB MARKET / NOVEMBER 2016
• Family income for house today is $100K+
“The country added a net total
of 11,000 jobs in the month,
but all of the gain was in part-
time work. Full-time
employment fell by 8,700
positions, while part-time jobs
grew by 19,400.
In fact, over the past year,
Canada has lost 30,500 full-
time jobs, while gaining
213,700 part-time jobs. That
likely helps to explain
why wages in Canada are
falling, when adjusted for
inflation.”
Source -
http://www.huffingtonpost.ca/2
016/12/02/unemployment-
canada-november-
2016_n_13369418.html

12. GRAPH 5 – WAGE GROWTH, INFLATION AND
HOUSING PRICE CHANGES
Source – CBC, CTV, Stats Canada and Canadian Real Estate association

13. RETAIL SALES BY SEGMENT
Source – Stats Canada

14. INDUSTRY INDICATORS
• Automotive
• Class 8 Truck Sales
• Agriculture Equipment
• Metal Processing Centers
• Oil Rig Count
• Power Generation/Canada

15. COMMODITY INDEX / SCOTIABANK
Source - Scotiabank

16. COMMODITY PRICES / SELECTED
• Source - BMO

17. AUTOMOTIVE ANALYSIS
“CEO Mark Fields said Ford’s plan
to move production of the Ford
Focus from Michigan to Mexico will
proceed, in part because US
consumers demand low prices for
small cars. The Focus starts at
$16,775, which is less than half the
average price that US consumers
pay for new vehicles.” Source -
http://www.plant.ca/general/ford-
ceo-says-trump-threats-wont-
change-small-car-plans-164160/

18. CLASS 8 TRUCK SALES – SALES PER DAY – UNITED
STATES
Source – The Trucker
“Heavy-duty truck sales in the
U.S. totaled 29,754 units in
November, 22.4% below like-
2015’s 35,279, according to
WardsAuto data. Canada’s big-
truck makers declined again,
posting a combined Class 4-8
sales drop of 12.5% on 2,830
deliveries.” Source -
http://fleetowner.com/equipm
ent/us-big-truck-sales-plunge-
november

19. AG EQUIPMENT SALES PER DAY
Source – Association of Equipment Manufacturers
• “The figures for the larger tractors however,
reflect a volatile landscape of commodity
prices and lower crop receipts.
• “Less than 100HP demand is linked to the
livestock segment, hobby farmers and
housing,” he said in the release. “The
relatively strong incomes in the livestock
sub-segment that helped support the
demand are expected to become subdued
over the next year.
• “The larger, production ag tractor sales
(>100HP 2WD and 4WD) continue to show
negative trends. With no improvement in
crop receipts forecasted for 2016 compared
to 2015, and subdued commodity prices, the
USDA expects the current downturn to
continue into 2017.”
• In Canada, tractor and combine sales seemed
to be a little better with sales of tractors
under 40HP and tractors between 40 and
100HP rising by 9.6 and 14.2 per cent,
respectively, between November 2015 and
2016. But sales of 4WD tractors fell by 13.9
per cent during the same period. ” Source -
http://www.farms.com/

20. METAL PROCESSING CENTERS (SALES PER DAY) –
EXPRESS IN TONNE
Source – American Machinist
“Metals shipments increased modestly
in November. Inventories continued to
decline by substantial percentages.
”Source - http://www.msci.org/news-
media/news-for-members/update-
archive/news-
detail/articleid/1343/metal-
shipments-increase-in-november

21. OIL RIG COUNT

22. CANADA POWER GENERATION
Source -
http://www.iea.org/media/statistics/surv
eys/electricity/mes.pdf
• “Adele Benoit doesn't have
any Christmas lights on her
house this year – it's an
expense she says she can't
afford.
• The Cambridge mother of
three says her hydro
electricity bill has gone from
$250 every two months last
year, to a bill this month for
$550 for two months of
power. ”
http://www.cbc.ca/news/ca
nada/kitchener-
waterloo/cambridge-
andrea-horwath-hydro-
rates-wynne-1.3896095

23. STEEL
PRODUCTION
Source - https://www.worldsteel.org
• “Rising demand and shrinking import
competitiveness have the American
steel market poised to enter a pricing
sweet spot, Jefferies said in a research
note published Monday.”
• “Rising steel prices in Asia have
disincentivized the continent's
steelmakers from exporting their
products to the U.S., Jefferies analyst
Seth Rosenfeld wrote.
• "Domestic steel consumers can find
reasonable bargains from domestic
suppliers," he added.”
• Source -
https://www.thestreet.com/stor
y/13922484/1/jefferies-sees-
fertile-ground-for-steelmakers-
like-u-s-steel-x-and-nucor-
nue.html

24. DURABLE GOODS – UNITED
STATES
Source – BMO
Source – CNBC
• Machinery purchases are still down 4.1% for YTD
October 2016 as compare to YTD October 2015
• Electrical equipment is about 1% up YTD October
2016 as compare to YTD October 2015
• Overall, new orders are down 2% compare to YTD
October 2015