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April 2015
Top 10 fastest growing
Canadian industries
By Ibrahim Yucel
While some industries have merely recovered from the economic
downturn, others have flourished due to longer-term consumer trends
The fastestgrowing
Canadian
industries
represent
a variety of
sectors
The Canadian economy’s recovery
from the recession has had wideranging impacts on domestic
industries over the past five years. The
ten fastest-growing industries over the
past five years, measured by average
growth in sales per year and compiled
from IBISWorld’s 424 Canadian
industry reports, feature industries
from a variety of sectors, including
heavy manufacturing, wholesaling
and professional business services.
While each industry exhibited
strong revenue growth, some have
experienced cyclical growth while
others have grown due to more
secular trends. For example, the
Nonferrous Metal Foundry Products
Manufacturing industry has merely
recovered from poor performance
during the economic downturn and
is unlikely to reach prerecessionary
revenue levels. In contrast, up-andcoming industries, such as recycling
facilities, have flourished due to
longer-term shifts in consumer
preferences. Similarly, industries
such as fertilizer manufacturing
have experienced wildly fluctuating
demand, while others, such as the
Beauty, Cosmetics and Fragrance
Stores industry, have grown
steadily over the five-year period.
Nonferrous Metal Foundry Products
Five-year annualized growth rate: 12.7%
Unlike the broader metal manufacturing
sector, the Nonferrous Metal Foundry
Products industry has outperformed the
economy as a whole during the past five
years, although its high growth rate is
mostly due to a quick postrecessionary
recovery. Despite recent growth, the
industry faces intense import competition,
which has forced many companies out of the
industry in recent years. Remaining
domestic manufacturers have increasingly
offered value-added services such as design
support, custom-made castings and
metallurgical testing to compete more
effectively against imports. Nonetheless,
foreign competition is expected to slow the
industry’s growth considerably during the
next five years. However, successful
Canadian metal foundries will continue to
work with domestic customers to design
high-precision, customized castings.
Recycling Facilities
Five-year annualized growth rate: 9.6%
Recycling facilities have flourished during
the past five years because of rising
environmental consciousness among
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April 2015 2
Top 10 fastest growing Canadian industries
Canadian households and favourable
regulatory conditions. Furthermore, rapid
technological advances, such as automated
trommels and eddy current separators, have
allowed recycling companies to separate,
sort and reclaim recyclable materials more
effectively and efficiently than ever before.
These improvements have reduced
operating costs, attracted new industry
entrants and boosted industry employment
an average 10.4% per year. Over the next
five years, the prices of glass, aluminum and
other reusable materials are expected to
increase, boosting demand for reclaimed
materials from downstream nondurable
goods manufacturers. In addition, ongoing
government initiatives such as the Waste
Diversion Act and the Policy on Green
Procurement will continue to drive demand
for recycling services.
Fertilizer Manufacturing
Five-year annualized growth rate: 9.4%
Although the Fertilizer Manufacturing
industry has grown overall in the past five
years, its performance has been particularly
volatile because of fluctuating input prices
and erratic demand from downstream
agricultural markets. For example, in 2013,
a worldwide drop in the price of potash, a
key fertilizer input, led to a massive 9.2%
decline in industry revenue; however,
Manufacturing sector vs. Fertilizer manufacturing
rebounding prices helped boost revenue by
12.9% in 2014. During the next five years,
the industry is expected to outperform the
overall economy, although growth will
depend heavily on the world prices of potash
and agricultural commodities such as
soybeans and wheat. Strong demand from
the United States, particularly for fertilizers
used in corn production, will likely drive
rising exports.
Beef and Pork Wholesaling
Five-year annualized growth rate: 8.7%
The Beef and Pork Wholesaling industry
has undergone a strong postrecessionary
recovery during the past five years.
Rebounding demand from the industry’s
key markets, which include grocery stores
and food service establishments, has
helped propel the industry since 2010,
when decreased consumer spending and
low red meat prices reduced industry
revenue to just $6.0 billion. However,
revitalized consumer spending and rising
livestock prices beginning in 2011 helped
drive industry revenue to over $8.9 billion
in 2014. Although per capita red meat
consumption is expected to fall slightly
during the next five years, consumers will
be more likely to purchase premium meat
products, such as grass-fed or organic
varieties. Since distributors can sell these
Administrative services sector vs. Recycling facilities
30
45
Fertilizer
manufacturing
Manufacturing
sector
15
0
-30
Administrative
services sector
10
0
-15
Year
Recycling
facilities
20
Revenue
Revenue
30
07
09
11
13
15
SOURCE: IBISWORLD
-10
Year
07
09
11
13
15
SOURCE: IBISWORLD
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April 2015 3
Top 10 fastest growing Canadian industries
products at higher margins, this trend will
likely become a primary driver of
industry growth.
Truck, trailer and motor home
manufacturing
Five-year annualized growth rate: 8.6%
Despite strong recovery during the past five
years, annual revenue for the Truck, Trailer
and Motor Home Manufacturing industry
remains well below prerecessionary levels.
The industry is highly cyclical in that
demand for recreational vehicles (RVs)
depends heavily on shifts in consumer
incomes and preferences, while demand
for trucks and trailers depends on
downstream demand from freighting
companies. Since retirees are the largest
market for RVs and motor homes, industry
operators have benefited from an aging
domestic population. During the next five
years, strong demand from freight
operators will likely drive revenue from the
industry’s commercial market. However,
competition from imported trucks and
trailers will continue to pose a threat to
domestic manufacturers.
five years, growth is expected to slow as the
world price of gold remains relatively stable
and the costs associated with
environmental compliance continue to rise.
Beef Cattle Production
Five-year annualized growth rate: 7.0%
The Beef Cattle Production industry, which
raises cattle for food inputs, has benefited in
the past five years from rising livestock
prices, strong export volume to the United
States and rebounding demand for red meat
from domestic households and food service
establishments. While per capita meat
consumption in Canada has declined during
the past five years, rapidly rising cattle prices
and strong demand from foreign markets
have nonetheless helped drive strong
recovery. In particular, cattle prices have
increased an annualized 13.9% in the five
years to 2015, while exports to the United
States, the largest consumer of beef
products, have grown 12.0% per year on
average. However, beef cattle production
has slowed in recent years, and in the next
five years the industry is expected to
underperform the overall economy.
Gold and Silver Ore Mining
Real Estate Investment Trusts
Five-year annualized growth rate: 7.9%
Five-year annualized growth rate: 6.7%
The Gold and Silver Ore Mining industry
performed very well during the first half of
the five-year period as the world prices of
gold and silver skyrocketed in 2010 and
2011. As a result, industry revenue spiked a
whopping 22.9% in 2010 and another 9.0%
the following year. However, gold and
silver prices have fallen in recent years,
including a decline of 15.4% in 2013.
Industry operators are expected to
continue suffering from higher extraction
costs and reduced profitability as the price
of gold falls a projected 8.3% in 2015.
Accordingly, revenue is expected to
increase only 0.5% in 2015. During the next
Like mutual funds, real estate investment
trusts (REITs) use pooled capital to
purchase, licence or finance incomebearing real estate. Unlike the US market,
the Canadian housing market did not crash
during the recession, and has actually
continued to bloom during the past decade.
Despite some speculation of a looming
housing bubble, REITs have performed
well during the past five years as the value
of Canadian real estate has remained
relatively high, and the values of both
residential and nonresidential construction
have risen. However, rising long-term
interest rates since 2012 have shifted the
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Top 10 fastest growing Canadian industries
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information and analysis on
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investor market from REITs to alternative
investments that yield higher returns.
Accordingly, industry revenue has waned
during the latter half of the five-year
period. During the next five years, industry
performance will continue to depend on
the overall state of the Canadian housing
market and other macroeconomic factors.
Beauty, Cosmetics and Fragrance
Stores
Five-year annualized growth rate: 6.6%
Beauty, cosmetics and fragrance stores
sell a variety of personal care products
to households and professionals,
including hair stylists and makeup
artists. During the past five years,
industry growth was primarily driven by
favourable consumer trends, although
broader economic factors such as rising
disposable income and increased
consumer spending have also helped
boost industry performance.
Historically, consumers turned to
department stores for premium skincare and cosmetic products, but in
recent years have increasingly visited
specialty beauty stores that offer a wider
range of premium products. This trend
is likely to continue in the coming years,
although brick-and-mortar beauty stores
will face intensifying competition from
Top Canadian Industries
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Corporate Wellness Services
Five-year annualized growth rate: 6.4%
Corporate wellness services provide
workplace programs designed to evaluate
and improve the well-being of employees,
reduce health-related costs and increase
workplace productivity. A widening talent
gap in the labour market has encouraged
businesses to invest in wellness programs
that attract the most talented candidates.
Accordingly, demand for industry services
has increased in line with rising healthcare
costs, increased corporate profit and a
stabilizing labour market during the past
five years. However, the industry has
experienced a massive surge of new
entrants, which has heightened
competition among operators.
Furthermore, corporate wellness
providers are increasingly competing with
in-house wellness programs and similar
services provided by fitness clubs and
large health insurance companies. Despite
these potential challenges, the industry is
expected to continue outperforming the
overall economy during the next
five years.
2015 Revenue
2010-15
2010-15
($ million)
Revenue growth*
Employment growth*
Nonferrous Metal Foundry Products
1,815.7
12.7%
5.3%
Recycling Facilities
Fertilizer Manufacturing
1,032.2
9.6%
10.4%
5,081.7
9.4%
3.8%
Beef and Pork Wholesaling
9,121.9
8.7%
1.5%
Truck, Trailer and Motor Home Manufacturing
4,679.2
8.6%
0.2%
Gold and Silver Ore Mining
7,374.3
7.9%
2.6%
Beef and Cattle Production
9,612.1
7.0%
-2.7%
Industry
Contact:
Media Relations
online beauty retailers. Overall, the
industry is expected to outperform the
overall economy during the five years
to 2020.
Real Estate Investment Trusts
8,853.5
6.7%
6.7%
Beauty, Cosmetics and Fragrance Stores
1,256.6
6.6%
4.9%
153.4
6.4%
Corporate Wellness Services
7.9%
*ANNUALIZED; SOURCE: IBISWORLD
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