The JDI Roundtable team has been conducting research to better understand the New Brunswick manufacturing sector compared to surrounding regions. By analyzing data on firm sector, size, employment, and geography in New Brunswick compared to Nova Scotia, PEI, Gaspésie, and Maine, we hope to provide insight into whether the manufacturing and processing industry in New Brunswick is distinct or whether it reflects broader regional trends.
In this installment, we investigate how the distribution of manufacturing businesses and manufacturing employment by firm size in New Brunswick compares to neighboring jurisdictions.
Across the broader region, smaller manufacturing firms make up the greatest number of businesses in each region but account for a small proportion of total employment in the sector. Figure 1 below indicates that all five regions have a similar distribution of firms in terms of size, with small (5-19 employees) and micro (1 to 4 employees) firms making up the greater portion of manufacturing businesses in region. Micro- and small-sized firms account for nearly four out of five manufacturing businesses in NB (79%), while the other regions showed similar numbers.
Except for ME, the ratio of manufacturing firms to residents was similar for each region. As of February 2020, there was one NB manufacturing business per 573 New Brunswickers, one NS manufacturing business per 597 Nova Scotians, and one PEI manufacturing business per 516 islanders. In contrast, ME has one manufacturing business per 859 residents – indicating that while the overall composition of manufacturing firms by size is similar across all five regions, ME has a fewer firms per resident compared to the Canadian regions.
Next, we break down total employment by firm size for each region. Figure 2 below shows large firms (500+ employees) account for a greater proportion of total manufacturing employment in Gaspésie and ME compared to NB, NS, and PEI. Employment at large-sized manufacturing businesses accounted for 12% of total manufacturing employment in NB, which is the lowest percentage among all the jurisdictions studied. Meanwhile, the employment numbers in micro- and small-sized manufacturing businesses are less than 20% of all employment in the industry in NB (19%) and ME (15%), despite making up a greater share of manufacturing employment in NS (22%), PEI (25%), and Gaspésie (20%).
For each region studied, medium-sized firms (20-499 employees) made up more than two thirds of total manufacturing employment in New Brunswick. Employment at medium-sized firms accounted for 68% of total manufacturing employment in NB, which is notably higher than the 59% regional average. “Medium” by this definition encompasses a broad spectrum of firms: looking more closely at the various categories within the “medium” umbrella, it appears that “medium-large” firms (100 to 499 employees) make up the greatest portion of employment within the “medium” category for each region captured. Of all the regions, New Brunswick has the greatest proportion of people employed in medium-large firms at 44%, compared to a 32% regional average.
In terms of manufacturing firm distribution and employment by firms, NB's manufacturing sector is comparable to neighboring regions, with a few notable exceptions:
July 7, 2020
Dr. Sarah McRae is a postdoctoral fellow at the University of New Brunswick and a member of the JDI Roundtable research team.
The JDI Roundtable on Manufacturing Competitiveness in New Brunswick is an independent research program made possible through the generosity of J.D. Irving, Ltd. The funding supports arms-length research conducted at UNB.
