While Canadian manufacturing may on the decline, a new report reveals that the country has managed to remain globally competitive, largely due to its financial and insurance services sector.
"Much attention has been paid to Canada's struggling natural resources and manufacturing sectors," said Jacqueline Palladini, Conference Board of Canada senior economist on global commerce. "However, there is an important but underappreciated bright spot in Canada's trade picture—services.”
The report found that the drop in global commodity prices has caused Canada’s resource-intensive organizations to shrink, but as it does, insurance is taking a more dominant role nationally, as well as in overseas trade and investment.
In fact, finance and insurance services represent Canada’s largest and fastest growing exports,
“The reality is that Canada is a dynamic, high-value services economy, and those services are increasingly being sold to the world," Palladini said.
While this may appear to be a drawback for Canadian manufacturing, the report notes that it just represents an evolution of the sector, which is now more integrated with services. The collaboration between the two has led to more innovative products through research, development and increased productivity.
In addition to these benefits, the Canadian insurance industry also helped the country remain resilient during the recession, primarily because of its highly educated workforce.
“During the global economic downturn Canada’s financial sector came out a lot better off than a lot of our foreign counterparts, which allowed them to buy up or invest in a lot of companies,” Palladini said.
The Conference Board report mirrors that of the Insurance Brokers Association of Ontario (
IBAO), which found that brokers also contribute substantially at the local level. In Ontario alone, insurance serves as the “backbone” of many communities, employing 17,898 licensed brokers and 2,355 accompanying staff.
“We’re very active in the communities that we do business in,” said Michael Brattman, president of IBAO, in an earlier interview. Really, “100% of brokerages are involved in community organizations, which shows that being active in the community is another thing we do well, and that goes a long way to building relationships with clients and consumers.”
