Canada 'can't rely forever on U.S. largesse:' Canadian Manufacturers and Exporters
Before joining the Coalition for a Better Future, President and CEO of Canadian Manufacturers and Exporters, Dennis Darby, says he “felt like a lonely voice saying our productivity has been falling, we have been falling behind our competitors.”
Addressing Canada’s lagging productivity is a critical issue for CME. Compared to other OECD countries, particularly the U.S., Canada is replacing equipment, adopting technology and training its labour force at a much lower rate, leading to more expensive goods for Canadians.
”We have been relying on a cheap Canadian dollar and huge demand from the U.S. to keep our industry going,” said Darby during an interview. He adds that for at least a decade, Canada wasn’t thinking about how to compete globally. “And that's where the Coalition came in. You recognize the same thing: that Canada really needs to up its game if it's going to win; you can't rely forever on the largesse of the U.S.”
Since its founding in 1871, CME has championed the goal of promoting companies based in Canada to grow and compete. Today, the organization represents over 2,500 members and 1.8 million employees from diverse industries, including cosmetics, oil and gas, food and nuclear power. Darby says, “We’ve got a bit of everything at CME.”
“That’s where the Coalition came in. You recognize the same thing: that Canada really needs to up its game if it's going to win; you can't rely forever on the largesse of the U.S.”
Dennis Darby, CEO & President, Canadian Manufacturers and Exporters
At all levels of government, CME advocates for laws and regulations to support Canadian manufacturers and exporters who Darby says endure like canaries in a coal mine in an unprotected industry that is “entirely trade-exposed.”
CME gives its members a leg up by offering training and education programs in productivity, exporting logistics, labour, skills, automation and gender equity. Hosting networking events is another piece of the puzzle in engaging companies across the country to work together in the “very tough” global market, Darby says.
CME is committed to solving Canada’s productivity challenges. According to Darby, the key is setting out a clear industrial strategy, like the one outlined in the group’s November 2023 report Manufacturing Canada's Future, that establishes “what we want to be when we grow up [and] where we want to fit in the world.”
Creating an environment that encourages investment is critical to improving Canada’s economic outlook, Darby says, adding the improvement of the past year has been “very episodic.”
Darby attributes our lagging performance to Canada’s “very complicated and quite extensive” tax and regulatory system, which he says makes it easier for companies to invest in the U.S. because of its efficient and comprehensive regulatory system, particularly its environmental policies.
“When I see our productivity, which is a measure of our prosperity, falling behind the U.S., that just means we're not as wealthy, and we're not doing as well as we have to. We have to change.”
Canada’s commitment to fighting climate change and growing biodiversity is essential to innovating and improving productivity. Darby envisions Canada as a leader in carbon capture, green energy and the pursuit of net zero emissions, but to actualize this, balancing incentives and taxes is essential.
“Most companies have no clue about how to achieve net zero. The vast majority of manufacturers in Canada have no plan. They're waiting for somebody to come and tell them ‘What do I have to do?’ So there's a tendency to be behind the curve.”
We need economic growth. That's how we fund our schools. That's how we make sure communities are strong, people have enough money to invest, to save, to get into education.
Dennis Darby, CEO & President, Canadian Manufacturers and Exporters
Growth in industry will improve prosperity for all Canadians, and rather than creating barriers, the government needs to get out of the way or make it easier for companies to invest, says Darby.
“We need everyone to start moving ahead, or what happens is you will have a progressively smaller industrial sector, which lowers our productivity, which in turn lowers our prosperity.”
Darby attributes the relative lack of foreign investment in Canada to the CUSMA review in 2026 and uncertainty about the forthcoming presidential election, which will have a “huge impact on the manufacturing sector.”
Though the U.S. has some “chronic pain points” with Canadian trade agreements, it’s up to Canada to make sure that the US sees Canadian manufacturers as “the best place for them to shorten their supply chain” Darby says, stressing it’s in the best interest of Canada, the U.S. and Mexico to work together in trade to potentially make one of the “strongest blocks in the world.”
Reflecting on the future of Canada’s economy and the role of CME’s advocacy, Darby looks to the 1.8 million industrial workers. “No manufacturer, no company wants to see its employees struggling and not able to keep up. We need economic growth. That's how we fund our schools. That's how we make sure communities are strong, people have enough money to invest, to save, to get into education.”
