Economic Analysis and Statistics  Canadian Industry Statistics  Canadian Economy  Goods  Manufacturing

Employment
Leather and Allied Product Manufacturing
(NAICS 316)

This section reviews trends in employment for Canada's Leather and Allied Product Manufacturing (NAICS 316) subsector between 1994 and 2003.

The data is obtained from Statistics Canada's Annual Survey of Manufactures (ASM) and covers incorporated establishments with employees primarily engaged in manufacturing and with sales of manufactured goods equal to or greater than $30,000, herein, referred to as principal establishments. Thus, unless otherwise stated, it would exclude non-employers, unincorporated establishments as well as establishments where manufacturing activity is minimal.

Because of major conceptual and methodological changes to the Annual Survey of Manufactures made in the year 2000, the reader should exercise caution when interpreting data and subsequent rates of change between the years 1999 and 2000. The magnitude of the effect from these changes on the statistics from the Annual Survey of Manufactures will differ between industries.

It should be noted that, starting in 2000, the Annual Survey of Manufactures no longer collects data on Head Offices. This will affect the following variables:

• the number of administration employees;
• the total number of employees;
• the wages paid to administration employees;
• the total wages paid to all employees;
• the cost of materials and supplies and goods for resale;
• total revenues (i.e. the value of shipments and other revenues);
• total value-added.

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Position in NAICS Hierarchy

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Employment

Employment within the manufacturing sector is separated into two major categories: production workers and non-production workers. Non-production workers are often called administrative workers and this convention is adopted on this site.

Production employees include those employees engaged in processing, assembling, storing, inspecting, handling, packing, maintenance, repair, janitorial, watchmen services and working foremen. Administrative employees include all employees that are not involved directly in production and related manufacturing activities. Examples include those involved in management, personnel, secretarial, sales, finance and other like activities.

For manufacturing industries, increased domestic production may bring about an increase in employment. However, this can be offset by improvements in technology which improve labour productivity (analysed in the performance section) resulting in a lower demand for labour. In addition, changes in contracting out practices or in the purchase of pre-processed components/materials may also affect the demand for workers.

Employment statistics obtained from the Annual Survey of Manufacturers (ASM) are annual averages as part-time and temporary employees are included as are employees absent with pay. On the other hand, contract workers, company pensioners, outside directors of incorporated companies and persons working on a full commission basis are excluded.

Employment by Type Principal Establishments** 1994-2003 Leather and Allied Product Manufacturing (NAICS 316)
Type of Employee	Number of Employees		% of Total 2003	CAGR* 1994-2003	% Change 2002-2003
	1994	2003
Production	11,071	7,322	82.2%	-4.5%	-10.9%
Administrative	2,027	1,584	17.8%	-2.7%	-9.7%
Total	13,098	8,906	100%	-4.2%	-10.7%
Notes: * Compound Annual Growth Rate ** Incorporated establishments with employees, primarily engaged in manufacturing and with sales of manufactured goods equal or greater than $30,000

The total number of employees for the Leather and Allied Product Manufacturing subsector decreased from 13,098 workers in 1994 to 8,906 workers in 2003, or at a compound annual growth rate of -4.2% over this time span. There was a decrease in employment between 2002 and 2003.

By comparison, total employment in the Manufacturing sector showed an increase of by 2.1% per annum over the 1994-2003 period and a decrease of -0.8% between 2002 and 2003.

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Employment by Type of Employee

Breaking employment into its two principal components, the number of production employees in the Leather and Allied Product Manufacturing (NAICS 316) subsector decreased from 11,071 workers in 1994 to 7,322 worker in 2003, or at a rate of -4.5% per year on average. There was a decrease of -10.9% in the last year.

Correspondingly, the number of administrative employees in the Leather and Allied Product Manufacturing subsector decreased from 2,027 workers in 1994 to 1,584 workers in 2003, or at an average of -2.7% per annum. There was a decrease of -9.7% over the course of most recent year.

It should be noted that, starting in 2000, the Annual Survey of Manufactures no longer collects data on Head Offices. This may result in a decrease in the number of administrative employees surveyed.

Number of Employees by Type
Principal Establishments
1994-2003
Leather and Allied Product Manufacturing
(NAICS 316)

For the Leather and Allied Product Manufacturing subsector, the percentage of employees that are production workers decreased from 84.5% in 1994 to 82.2% in 2003. As a result, there was a relative increase in the proportion of administrative workers.

This can be compared to the Manufacturing Sector as a whole where 75.9% of employees were production workers in 1994 compared to 77.6% in 2003. This proportion increased at an average rate of 0.3% over the 1994-2003 period and it decreased by -0.5% in 2002-2003.

Several factors may contribute to decreases in the proportion of administrative workers. For instance, a reorganisation of the work force or technological improvements may result in a lower demand for administrative workers. Or again, changes would be expected if a significant proportion of establishments within an industry elects to purchase some services rather than perform them in-house. Changes in these ratios over time could result from a number of factors.

First, the number of production workers in relation to the total may have decreased for a number of reasons, e.g. increased reliance on contract employees.

Second, the composition of the non-production cohort may have been transformed. The non-production workers include managers, administrators and professions such as engineers and computer and research scientists. As modern industries become more knowledge intensive it is possible that this component of the work force may have grown in significance.