CAMM and Automate Canada have surveyed manufacturers throughout the COVID-19 lockdown. Click image to enlargeManufacturing is feeling the financial pain of the COVID-19 lockdown, with cash flow among the leading concerns, according to the latest survey by the Canadian Association of MoldMakers and Automate Canada.

 

The two industry organizations have been surveying their memberships—made up largely of companies with less than 50 employees—weekly, establishing some trends in how companies have managed the first few weeks of economic lockdown, and how they think the recovery will shape up.

The largest impacts on businesses have shifted from the first weeks, with cash flow concerns at the top of the list. Employee anxiety is still a top concern, but it has been trending down as sales disruption and project cancellations have risen.

In Week five, project cancellations dominated the list with continued delays and few new programs compared to prior weeks.

The number of employees out of the workplace due to isolation or quarantine dropped to 58 in total, from 97 last week. About 65 per cent of respondents reported having no employees on quarantine, down from 51 the week prior. For the first time since the survey began in March, none of the larger employers reported having 20 or more employees off on quarantine.

Layoffs have also slowed, with 65 per cent of respondents laying off no workers this week. In another positive trend, compared to 46 per cent last week. The number of employees laid off also decreased this week, with 143 employees laid off temporarily, compared to 197 in week 4. Even with fewer participants in this week’s survey, this still shows a sharp decline in temporary layoffs and demonstrates that employee counts have stabilized.

Indeed, the survey indicates most workplaces are not letting employees go permanently. Some 29 employees were reported as permanently laid off in week 5, down from 32 the week before. Almost 90 per cent of respondents reported not letting anyone go permanently, however, there were no new hires reported. Manufacturers have begun to recall employees, with 32 per cent of respondents calling at least one employee back.

Government Programs

Manufacturers are definitely taking advantage of the Canada Emergency Wage Subsidy program, deferring remittance of taxes and duties and making use of products from EDC & BDC. The most commonly mentioned programs across each week, however, were still EI & SR&ED.

Since week four of the survey, 75 per cent of respondents indicated they were willing and able to supply products or services for medical equipment or devices. For each of the previous survey weeks, about one third of respondents have been able to answer the call for their services or products, mostly in the production of tooling for medical equipment manufacturing.

The increases in workplace shutdowns have slowed in week five, with 37 per cent of respondents at 90 per cent of full operations, compared to 30 per cent last week. The number of workplaces that are completely (or almost completely) shut down remained fairly consistent at 15 per cent.

Most of these shutdowns were due to employee absences and loss of work. Health and safety concerns didn’t factor as heavily this week as in prior weeks, suggesting that workplaces have adopted effective health and safety practices. However, most respondents were not hopeful for a swift return to normal. Most respondents either wouldn’t commit to a date or indicated they think it will take at least four more weeks before they return to full operations.

It’s not all doom and gloom, though, with a number of manufacturers reporting improved collaboration within their company, diversification of their markets, improved connection to government services, and adoption of new technologies and better workplace health and safety practices as upsides to the current situation.

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