MASSE IN THE NEWS: CBC Radio - The House - Review of The House's coverage of manufacturing crisis; interview with Rob Hattin

PUBLICATION: CBC Radio - The House
DATE: 2009.07.04
TIME: 9:10 EDT
WORD COUNT: 5351

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Review of The House's coverage of manufacturing crisis; interview with Rob Hattin

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LOUISE ELLIOTT (HOST):

- LOUISE ELLIOTT (HOST):

You may want to hang around and focus your mind if you work in the manufacturing sector. We'll look back at the ups and downs of the past couple of years and we'll hear from a factory owner. He'll tell us what manufacturing may look like once the recession is over: ROB HATTIN (PRESIDENT, EDSON PACKAGING MACHINERY; ONTARIO CHAIR, CANADIAN MANUFACTURERS AND EXPORTERS):

You know, manufacturing will come here, but it'll be in a different form. It'll be on more one-offs, mass-customization - you know, lots of things, each one's a little bit different.

LOUISE ELLIOTT (HOST):

Everything's a little bit different in the summer. We get a chance to sit back and blue-sky about the future... -

The summer season is upon us, and The House has some special programming planned for the next 10 weeks. We're going to be repeating some of our favourite documentaries, and we'll revisit some favourite themes. Over the last two years, The House has done numerous interviews on a variety of topics, from greenhouse gases to employment insurance. We thought it would be helpful and interesting to give you a retrospective of our coverage, to see where each issue has been. Each of our theme packages will be followed up by an interview with someone integral to the story who can tell us where we are now. This week, we'll bring you up to date on the trials and travails of Canada's manufacturing industry. It's been a rocky couple of years for the country's factories - high energy costs, a volatile dollar and a crashing economy. We'll start our journey in June 2007, when the major challenge facing Canadian manufacturers wasn't a global recession. It was high fuel prices and the skyrocketing Canadian dollar. Thousands of unionized workers rallied on Parliament Hill, urging the government to take action on job-losses:

(Mixed voices; carillon)

UNIDENTIFIED MAN:

Now here's one you can help him sell (?).

TIM BLACKBOROUGH (SPELL) (STEELWORKER):

I'm Tim Blackborough (spell.). I'm a steelworker. I'm concerned about the job losses in the industrial corps. We went from a maximum of 14 000 people to approximately 1800...

UNIDENTIFIED WOMAN:

(Shouting): (Inaudible) for good jobs!

LOUISE ELLIOTT (HOST):

Following that rally, then Industry Minister Maxime Bernier - remember him? - spoke with Kathleen Petty. The government had just agreed to measures recommended by the Commons Industry Committee. The committee report classified the downturn in manufacturing as structural, not cyclical. We asked Minister Bernier for his thoughts:

MAXIME BERNIER (THEN MINISTER OF INDUSTRY):

Yeah, but it's the same thing not only in Canada, but all across North America, and even in China, so it's a global economy, and it's tough for workers that they're working in the manufacturing sector, but there is a future.

KATHLEEN PETTY (THEN HOST):

Right now, manufacturing sector is about 17 percent of the economy. Do you think it will remain as such? I'm just trying to get a sense of how you see the future. Will manufacturing be a smaller part of that, and the resource sector will continue to grow and be a bigger part of that, or what do you see?

MAXIME BERNIER (THEN MINISTER OF INDUSTRY):

Yeah, I think we will always have manufacturers' industry sector here in Canada, but what will be the percentage at the end of the economy? I don't know; I don't know. We cannot predict the future, but what we can do as a government is to be sure that these entrepreneur all across the country, they can work in a good environment, in a good fiscal environment, that will help them to grow and to compete.

LOUISE ELLIOTT (HOST):

A few months after we spoke to Maxime Bernier, we had Liberal MP Martha Hall Findlay on the show. She was a bit more definitive about what the future of Canada's economy would look like:

MARTHA HALL FINDLAY (THEN LIBERAL CANDIDATE FOR WILLOWDALE):

Well, I think we have to be careful about saying, "If we're going to move forward with this country, do we necessarily keep all of the existing jobs?" and I think most Canadians will understand that the future of this country is not going to lie with cheap labour, but that we recognize that the future of the country economically is one that lies with innovation, with commercialisation of new technologies. Our challenge is to make sure that we can address the changing nature of our job market so that people who lose jobs can actually move into more progressive, more innovative economies.

LOUISE ELLIOTT (HOST):

And the opposition didn't stay quiet on the subject. It was September 2007, and the loonie was still in the stratosphere, so we spoke with then Liberal Industry Critic Scott Brison and NDP Industry Critic Brian Masse. We extended an invitation to then Industry Minister Jim Prentice too, but he declined. Kathleen asked Masse what the government should be doing.

BRIAN MASSE (NDP INDUSTRY CRITIC):

You know, to leave it to the open markets is irresponsible, because we're saying that we don't play a role in terms of governance to set those things, and that's an isolation to the rest of the world. Japan does a great job of protecting their auto industry, for example, same with Korea. That's because they've identified that those jobs are important for their citizens and they lead to wealth and then the net benefits for their citizens after that in their country. Ourselves, what we've done is we've cast this to the wind and said, "Okay, well, good luck. We'll let it be on the backs of ordinary working Canadians," and then we blame them later on for not being productive because their manufacturing sector in the business-development hasn't made the investment. You know, we have to answer that fundamental question. Is there a role for government to actually develop industry in those sectors that we feel are good? And once again, I would argue that there is, and that's from public policy, and it just can't be done to lower a corporate tax cut (?) and hope things are going to get better. We did that with 10 years with the Liberals. We watched 250 000 jobs disappear across Ontario and Quebec and the rest of Canada, and it's not acceptable, because that's not being practiced anywhere else.

KATHLEEN PETTY (THEN HOST):

Mm-hm, Scott Brison?

SCOTT BRISON (THEN LIBERAL INDUSTRY CRITIC):

Brian, you say that we should be doing what other countries are doing in terms of strategic sectors. I agree; there is a role in aerospace. And in fact, when I was Minister of Public Works, when we negotiated aerospace and defence procurement, we made sure there was strong in-service (?) support and long-term benefits to Canadian industry. But beyond that, you say we should be doing what other countries are doing, and I agree. We should be reforming our taxes to be more competitive. That's what Ireland has done; that's what Australia has done; that is what New Zealand has done; that is what Sweden has done; it's what, in fact, the Netherlands have done. Those countries have among the lowest corporate taxes in the world. They have resulted in tremendous economic growth and prosperity and opportunity and competitiveness, so if we're going to follow your logic that we ought to be doing what other countries are doing to build greater competitiveness, we need to reform our tax system, focused on growth, prosperity and efficiency.

KATHLEEN PETTY (THEN HOST):

Okay, let...

LOUISE ELLIOTT (HOST):

So we'd heard ideas from politicians, but what about the manufacturers themselves? In November 2007, we spoke with two - Rob Hattin, president of Edson Packaging Machinery, and Darryl Spector, operations manager of ProMation Engineering. Both companies design and build machinery. We asked Darryl Spector what he thought manufacturers needed to recover:

DARRYL SPECTOR (OPERATIONS MANAGER, PROMATION ENGINEERING):

I think one of the big challenges for the turnaround right now is a number of factors. One is, like Rob was alluding to with the dropping of the interest rate, of course, that is important to us all, is the access to working capital. In order to innovate, we need the resources to do so. It's a learning curve for all of us. We need to not only learn new strategies, but learn about the existing strategies, and for a company whose primary industry is producing a product, our product is not learning about what is out there. We need people to tutor us; we need people to mentor us.

KATHLEEN PETTY (THEN HOST):

Rob?

ROB HATTIN (PRESIDENT, EDSON PACKAGING MACHINERY):

I think anything that supports innovation and... needs to be looked at. Certainly, moderating the Bank of Canada's position on inflation versus an escalating currency, because really, if we're paying more for goods anyway, through labour or whatever, or paying more for interest rates, it's inflationary, so I think we need to better track what the U.S. Fed is doing, because they are our largest trading partner. The other one, you know, there's some real simple ones that can be done. The Scientific Research tax-credit program is a good one. Our company has hundreds of thousands of dollars of tax credits, but because we're losing money due to the currency, I can't apply a tax credit against profit I don't have. However, every month, I send income tax and E.I. payments and W.S.I.B. payments to government agencies. So it's kind of like having Canadian Tire money but no Canadian Tire, and they need to allow us to spend those tax credits on, you know, supporting the government expenditures that we go into. It frees up working capital...

DARRYL SPECTOR (OPERATIONS MANAGER, PROMATION ENGINEERING):

Mm-hm.

ROB HATTIN (PRESIDENT, EDSON PACKAGING MACHINERY):

... and it rewards innovative companies right away.

LOUISE ELLIOTT (HOST):

Sticking to the effects on the ground, we spoke with Jayson Myers, president of the Canadian Manufacturers and Exporters. It was late November 2007. The Economist magazine was predicting an American recession, and we asked Myers what that could mean for manufacturing in Canada:

JAYSON MYERS (PRESIDENT, CANADIAN MANUFACTURERS AND EXPORTERS):

Well, that's the other part of this. It's... really is, you know, a perfect-storm situation. You've got an appreciating dollar, but this is really because of the U.S. market weakening, and the U.S. dollar depreciating. And for many companies, that's going to make it very difficult to respond to the dollar, if your major customer-base isn't... you know, your customers aren't buying as much. And again, this just underlines the urgency. Clearly, the government cannot do anything to buoy up the American economy or buoy up the American dollar, but what they can do is make it easier for Canadian industry and Canadian businesses and exporters that are at the cutting edge of competition and innovation to continue to make the investments that they have to make in order to respond.

KATHLEEN PETTY (THEN HOST):

Just tell me really plainly, what are you worried about here? We keep hearing about job loses in manufacturing; we've got prediction of a recession in the U.S. Just lay it out for me. What are you afraid of?

JAYSON MYERS (PRESIDENT, CANADIAN MANUFACTURERS AND EXPORTERS):

My big worry right now is that we're seeing an increasing rate of closures, production that is leaving the country or production that is just shutting down. This is no different than any other turndown in the U.S. economy. We're not going to be able to withstand a recession in the U.S. if we see our major export, major manufacturing base, begin to erode.

LOUISE ELLIOTT (HOST):

Well, the closures kept coming. In May 2008, Campbell Soup announced the closure of their plant in Listowell, Ontario, putting 500 employees out of work:

BONNIE MILLER (SPELL.) (FORMER EMPLOYEE OF CAMPBELL SOUP COMPANY):

My name is Bonnie Miller (spell.), and I run the (inaudible) area in Campbell's. Monday at 2:30, they invited all employees to come into the plant, that there was a big meeting. They said, "It wasn't our fault; there wasn't anything we could do." I looked around at people crying that were shocked. I thought there's 40-some years of my life. It snowballs; it just doesn't affect us. I mean, it affects trucking companies; it affects our suppliers. It's security guards; it's cafeteria that was employed. So, I mean, it just affects the whole community. It's a blow.

LOUISE ELLIOTT (HOST):

The week of the closure, we spoke with two members of the Commons Finance Committee - Liberal MP John McCallum and Conservative MP Rob Merrifield. We asked McCallum what a Liberal government would do to face the challenges in manufacturing:

JOHN MCCALLUM (LIBERAL MP):

Certainly, geography ties us to the United States, and always will, but I think as the centre of global gravity shifts to Asia, we have to make a more determined push to deepen and strengthen our trade links with Asia. Second, I would say yes, it would be great if we could provide more support for the economy at these difficult times. First and foremost, a Liberal government, it's in our genes not to go into deficit, but that having been said, to the extent funds are available, we would want to push to support the manufacturing sector more strongly. We also agree with the Conservatives that to support our economy in the medium-term, to bring jobs and investment to Canada, lower-corporate tax cuts are a good idea. We would work to reduce interprovincial trade barriers. We would also want to put funds into... more funds into infrastructure. And finally, we would like to have a major attack on poverty; we would want to put more money into the pockets of poor people, partly because they need it most, but also they would spend, and that would help to support the economy.

LOUISE ELLIOTT (HOST):

Well, just a few months later, the Liberals were talking Green Shift, but they also got to campaign on their manufacturing ideas. Canada was thrown into its 40th general election campaign in September 2008. We had John McCallum back on the show, along with Finance Minister Jim Flaherty and the NDP International Trade Critic Peter Julian. Kathleen asked Peter Julian about the NDP's announcement of eight billion dollars to create green jobs in manufacturing:

PETER JULIAN (THEN NDP CRITIC FOR INTERNATIONAL TRADE):

It's just responding to the reality, Kathleen. Over the last 20 years, most Canadian families have seen their real income drop. What we've seen over the past 20 years is, essentially, because the emphasis has been corporate tax-cuts, haemorrhaging of manufacturing jobs, a loss of jobs out here in British Columbia in the forestry sector - whole communities have shut down. And the impact on the average Canadian family has been that their debt-load has doubled, so what the NDP is proposing - and Jack Layton as Prime Minister - would bring about a real industrial strategy, something we haven't had for decades.

KATHLEEN PETTY (THEN HOST):

Jim Flaherty, let's talk about the pain at the pumps, because it's particularly acute this weekend. There's been a huge spike across the country, this in the same week that the Prime Minister announced a two-cent reduction in the excise tax on diesel. He's often said he can't do anything about the price at the pumps, but people are going to be asking.

JIM FLAHERTY (CANADIAN FEDERAL MINISTER OF FINANCE):

Well, certainly we see fluctuations. We've seen dramatic fluctuations in the world price of oil this year. We have a worldwide economic slowdown now, and Canada's not an island. In terms of diesel fuel, this is a specific problem that... for our truckers, for our fishermen/fisherwomen, for people in small business who need to travel and move their goods around, and so this reduction in half of the diesel tax is very important to (inaudible) being responsive to Canadian business, and it will affect all of us in our homes, because goods get moved around this country largely by truck, largely by diesel. I'm looking forward to the development of a new refinery in New Brunswick that's going to be very important for Canada, and I look forward to more developments in the West in terms of refining capacity, which is a different issue but something that we need to encourage in Canada.

LOUISE ELLIOTT (HOST):

An estimated 250 000 jobs have been lost from manufacturing, mostly in Ontario and Quebec. I travelled to the Niagara region of Ontario last September to find out how the election campaign was playing out. Here's part of my report:

MALCOLM ALLEN (NDP MP):

You're looking at what was the old Welland Canal, so at one time, this roadway contained all the major industries in Welland.

LOUISE ELLIOTT (REPORTING ON ELECTION CAMPAIGN):

Malcolm Allen stands in front of the John Deere plant in Welland, Ontario. After a century in this very spot, John Deere announced last week that it's pulling out. Allen is the NDP candidate here. In his day job, he's a financial officer with the CAW.

MALCOLM ALLEN (NDP MP):

It's a huge blow to Welland and the surrounding area, because clearly not all 800 people live in Welland, and we have seen somewhere close to 15 years of job after job leave this region. You don't have to drive around Welland very far to see the number of jobs that are lost, whether it be Atlas Steel, Ucar, whether it be the drop forges. I mean, there's literally thousands of jobs left Welland.

LOUISE ELLIOTT (REPORTING ON ELECTION CAMPAIGN):

Statistics Canada says 55 000 were lost in Ontario in the month of July alone. Here in Welland, the NDP lost to the Liberals by only a couple of thousand votes in the last election. The Conservative candidate came a close third. No party has a lock, partly because the NDP can't count on workers' votes the way it used to.

(Indistinct voices)

TOM HARIETHA (SPELL.) (PLANT CHAIR, LOCAL 275):

You guys been talkin'?

UNIDENTIFIED MAN:

Yeah, we (inaudible).

TOM HARIETHA (SPELL.) (PLANT CHAIR, LOCAL 275):

What do you think?

LOUISE ELLIOTT (REPORTING ON ELECTION CAMPAIGN):

Some union leaders come out of the fence gate to chat with Allen. Tom Harietha (spell.) is the plant chair of Local 275:

TOM HARIETHA (SPELL.) (PLANT CHAIR, LOCAL 275):

The history started last Tuesday, I mean, as far as the closure, so that's... we know basically very, very little about anything about the closure, except that we're moving to Mexico, and we're not going.

LOUISE ELLIOTT (REPORTING ON ELECTION CAMPAIGN):

Harietha will be voting for Allen in the next election, but even he isn't sure how his colleagues will vote. (As host): Malcolm Allen went on to win the riding of Welland, Ontario for the NDP, but, of course, the Conservatives won the federal election last October. Elections aside, though, things were happening at the provincial level as well. By February, the challenge facing manufacturing wasn't the high dollar and high food prices. Instead, the recession was rearing its ugly head. The Martin Prosperity Institute released a report, commissioned by Ontario Premier Dalton McGuinty. Kathleen spoke with Institute director, and the study's coauthor, Richard Florida, and asked him what he meant by saying Ontario's economy was in the midst of a global economic transformation:

RICHARD FLORIDA (DIRECTOR, MARTIN PROSPERITY INSTITUTE; COAUTHOR OF THE STUDY "ONTARIO IN THE CREATIVE AGE"):

Well... And I think that's what this economic crisis is all about. It's kind of the tectonic shift; it's kind of the earthquake that this transformation has set off. You know, for the past 100 or 150 years, we've been an economy that's made its wealth on raw materials and physical labour, and then beginning perhaps 20 years ago, we began to transition to an economy where ideas, knowledge, creativity mattered, and sure we see that in technology, but we also see that in entertainment, but we also see that in the transformation of our food industry and certain parts of our manufacturing industry. Now, if we're going to compete in the world economy, we have to be an economy where our people and their knowledge and their full capabilities matter. The real example of a company that gets this isn't a Google or Apple; it's Toyota. And this theory is really based on the idea that Toyota said... and many other manufacturing companies in our province and elsewhere do this... it's just an example... said, "We're going to be beat the other auto companies, particularly some of those Big Three companies," back 25 years ago, because they see the CEO as the... and the engineer... we know that we need them, but we need the shop-floor worker. It's the shop-floor worker's brain power, teaming (?), continuous improvement, bringing ideas and analysis and new concepts to the factory-floor, actually designing their work and making the product better.

LOUISE ELLIOTT (HOST):

But, of course, the government can't fix Canada's economy on its own. The Canadian economy is tied tightly to the United States, and Buy American policies in the U.S. Congress' economic-stimulus package were hurting manufacturers north of the border. Liberal Foreign Affairs Critic Bob Rae offered this anecdote:

(Mixed voices in background)

BOB RAE (LIBERAL FOREIGN AFFAIRS CRITIC):

Mr. Speaker, at Camp Pendleton in California, they're tearing out pipes made by IPEX, a company in Mississauga, for one simple reason -- those pipes contain the words "Made in Canada".

LOUISE ELLIOTT (HOST):

We checked in with Hayward Gordon Ltd., an industrial-equipment company based in Halton Hills, Ontario. The company manufactures pumps, three quarters of which enter the U.S. market. John Hayward runs the company, and Kathleen asked him how the Buy American clause was affecting business:

JOHN HAYWARD (HAYWARD GORDON LTD.):

Well, we really didn't see it coming to this extent. As of February - February 17th -- the stimulus package was voted on and approved in the U.S., it contained Buy America provisions that basically say, for any public infrastructure projects, that all iron, steel and manufactured goods must be made in the U.S.A., and because we sell into this market, as many Canadian companies do, into infrastructure, water and wastewater for us, we can no longer produce our products in Canada and sell them into those markets -

KATHLEEN PETTY (THEN HOST):

(Interrupting): But there were some assurances, even from the U.S. President when he was visiting this country, that he understood that, you know, NAFTA provisions would prevail in this case, and there seem to be assurances from the federal government that it might not be as damaging as first feared, but apparently it is.

JOHN HAYWARD (HAYWARD GORDON LTD.):

Well, I guess you needed to have more understanding of the limitations of NAFTA to really appreciate what that meant. It was very clever, because while it's true that the U.S. is living up to their NAFTA and WTO obligations, what hasn't been said is that NAFTA and WTO do not apply at many levels of sub-federal spending. It doesn't apply period at municipal, and that's where a huge amount of the infrastructure-spending takes place. Virtually all the water and wastewater-treatment spending takes place at the lowest level, which is municipal, and -

KATHLEEN PETTY (THEN HOST):

(Interrupting): So that municipalities are not bound by NAFTA. I don't think states are either, are they?

JOHN HAYWARD (HAYWARD GORDON LTD.):

They are not. There are no states that are bound by NAFTA. There are some states that are somewhat bound by a WTO agreement, but not for Canada, because Canada took exception to that level as well. So as far as Canada is concerned, there's no treaty agreement - NAFTA or nothing else - that applies at state or local levels.

KATHLEEN PETTY (THEN HOST):

Now, 75 percent of your market is in the U.S. so what are your U.S. customers telling you?

JOHN HAYWARD (HAYWARD GORDON LTD.):

Well, interesting. I mean, I'm getting requirements to sign affidavits now almost every day to say that our products are made in the U.S., which of course they're not, and so I'm having to deal with that, but I was just talking with a customer in Indiana, and this was the actual... an engineer from the municipality just pulling out his hair, saying, "I just want your products. I'm just so frustrated by this." What I'm having to do now is explore manufacturing facilities in New York and Pennsylvania in a couple of weeks -- I've got a trip planned - because -

KATHLEEN PETTY (THEN HOST):

(Interrupting): You're going to have move your operations (inaudible)?

JOHN HAYWARD (HAYWARD GORDON LTD.):

Well, I'm not going to pick up the entire plant, but I have to move part of it, enough to satisfy these requirements. Some other companies that I'm working with, it's very extreme because of the nature of the product they produce. It's more black-and-white for them: They either produce it in Canada or they produce it in the U.S.; there's no in-between.

LOUISE ELLIOTT (HOST):

Well, that's just a taste of our coverage of the manufacturing crisis over the last two years, and to bring us right up to date, we're checking back in with one of the manufacturers we spoke to in the fall, Rob Hattin. He's the president of Edson Packaging Machinery, and the Ontario chair of Canadian Manufacturers and Exporters. While he's worried about Buy American, he also sees another big problem on the horizon - U.S. environmental legislation. Rob Hattin, good morning, and welcome back to The House.

ROB HATTIN (PRESIDENT, EDSON PACKAGING MACHINERY; ONTARIO CHAIR, CANADIAN MANUFACTURERS AND EXPORTERS):

Thank you for having me.

LOUISE ELLIOTT (HOST):

We know you're being affected by the Buy American policies. Your members certainly have been. But what about the new U.S. law on climate-change that's just passed the House of Representatives?

ROB HATTIN (PRESIDENT, EDSON PACKAGING MACHINERY; ONTARIO CHAIR, CANADIAN MANUFACTURERS AND EXPORTERS):

I think that's probably even more insidious, because, you know, it's one of those bills that says we're going to do good things for the environment, but really, it's the wolf in sheep's clothing, because at that point in time, there'll be so much bureaucracy enabled that any importers into the U.S. will have to show their carbon footprint and all the other energy sources that went into their product in order... so that there can be offsets on carbon. I don't think it's been well thought out. As I said, it's even more insidious, so that and the Buy America act are probably two of the most protectionist things we've seen. I think the part that's really frustrating is, although the American politicians... who are saying, "Well, these are American taxpayer dollars; they should be spent here..." is the fact it's a global supply-chain, so castings come from China, machine parts come from Germany, technology comes from Italy, and all those little bits and pieces go into something that somebody in Iowa may assemble, and you just can't say, you know, "Let's understand where all the carbon is being spent." It'll grind to a halt quicker than taxes going to Ottawa.

LOUISE ELLIOTT (HOST):

So given those concerns, what else should our federal government be doing to help manufacturers?

ROB HATTIN (PRESIDENT, EDSON PACKAGING MACHINERY; ONTARIO CHAIR, CANADIAN MANUFACTURERS AND EXPORTERS):

I think that all we can do is continue to educate the American Senate and House of Representatives in saying, "You know, you're the one who wanted global trade, and now you're becoming very protectionist in some areas, and you can't have your cake and eat it too when it comes to that."

LOUISE ELLIOTT (HOST):

In the package that I just introduced, we played a clip of Richard Florida, and he was explaining his position about an idea-based economy. What do you make of that idea?

ROB HATTIN (PRESIDENT, EDSON PACKAGING MACHINERY; ONTARIO CHAIR, CANADIAN MANUFACTURERS AND EXPORTERS):

I have my own twist on Richard's idea, and I... you know, I think anything that says knowledge is a good thing, because you cannot take it away, you cannot close it down, you cannot shut it off, and really, at the elemental level, that's fundamental to all businesses, and, you know, for Edson, you know, our little company over in Hamilton, we're about 100 people, the reason that we are doing so well even during this recession is the fact that we did two things: We focused on the customer, and then we went out and built it and did some other cool things. And it was really from the generation of ideas, not just in terms of the design, but also in how we put it together. Many people say - and I'm kind of "I don't know" 'cause I don't have a crystal ball - that a lot of mass-manufacturing jobs will no longer be North American based. They might be right, so to replace those types of jobs will be those that have a high level of knowledge or ideas to them. The engineering and the manufacturing side reach a confluence - you know, they come together. I think at that point in time, manufacturing will actually return to North America, because when you have a high content of knowledge along with the skills of "How do you fabricate it? How do you build it?" because, you know, eight weeks on a boat is unacceptable to some people, then, you know, manufacturing will come here, but it'll be in a different form. It'll be on more one-offs, more, as some of us in the Canadian Manufacturers and Exporters Association say, you know, mass-customization - you know, lots of things, each one's a little bit different.

LOUISE ELLIOTT (HOST):

So given those thoughts, I mean, what's the mood right now among your workers? Are your employees giving up on industry and manufacturing as a sector, or are they hoping for a turnaround?

ROB HATTIN (PRESIDENT, EDSON PACKAGING MACHINERY; ONTARIO CHAIR, CANADIAN MANUFACTURERS AND EXPORTERS):

Man, you know, if you would have asked me yesterday, we had our best month for shipping equipment. We shipped at our place three pieces of very unique equipment that are going to Saudi Arabia. So if anything, our workers at Edson are saying, "Rob, please turn down the thermostat a little bit here; you know, you've been running us hard." I think for others in my peer group... I polled them before I came over... there's a full range of business is down. Generally, I'm hearing a number like 20, 25 percent. But it's interesting: Ninety percent of them are very optimistic that there's going to be a rebound, and everyone's just poised to figure out, "Well, how do we participate in it?" and it all seems to centre around the fact that we're taking this time to change our business, to engage our workers, to say, "How are we going to do this?" and that's kind of what was a common theme - you know, very cautious optimism, but optimism nonetheless.

LOUISE ELLIOTT (HOST):

And what's your prediction, then? I mean, you mentioned earlier the possibility of manufacturing jobs being located largely outside of our country. Do you see that as the future of Canada's manufacturing industry, or do you see it as a more optimistic picture?

ROB HATTIN (PRESIDENT, EDSON PACKAGING MACHINERY; ONTARIO CHAIR, CANADIAN MANUFACTURERS AND EXPORTERS):

No, I... I... For me, I actually see manufacturing returning, and again... but it won't be mass-production. The challenge we have in Canada is that we tend to want to ship our resources for processing somewhere else, when in actual fact, we should be saying, "Well, we're spending a lot of money shipping it to some place and then bringing it back and taking it through distribution." We should be having the courage and the tenacity to say, "Well, let's, you know, take that piece of wood and process it into a really cool-looking piece of furniture as opposed to, you know, maybe something that IKEA would get, where it's mass-produced."

LOUISE ELLIOTT (HOST):

Rob Hattin, thank you very much.

ROB HATTIN (PRESIDENT, EDSON PACKAGING MACHINERY; ONTARIO CHAIR, CANADIAN MANUFACTURERS AND EXPORTERS):

Thank you.

LOUISE ELLIOTT (HOST):

Rob Hattin is the president of Edson Packaging Machinery and the Ontario chair of Canadian Manufacturers and Exporters.