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“GDP in the sector rose 46 per cent between 2009 and 2011. The value of manufacturing shipments has continued to rise in 2012, with a 27 per cent gain during the first half of 2012, compared with the first half of 2011,” Reurink says. The $5.2 billion contribution to the provincial GDP amounts to an estimated $13.7 billion in revenues, according to Statistics Canada. Overall, in the last dozen years, the sector’s growth curve looks relatively consistent, despite the peaks and valleys. Between 2001 and 2011, the number of employees grew by nearly 12,000 to about 43,000, with the value of shipments more than doubling to $13.7 billion.
FAST GROWING In its pace of growth, however, the sector stands out. From 2001 to 2011, the province’s machinery and fabricated metals industry was the fastest-growing manufacturing sector in the province, with output growth of 81 per cent, compared with a 21 per cent increase in GDP for Alberta’s manufacturing sector, overall. “Much of this sector’s GDP increase occurred between 2000 and 2006, with an increase of 60 per cent during that period,” Reurink points out. According to an analysis he did, which he notes is derived from Statistics Canada data, the sector’s largest subsectors on a revenue basis are: ➳ Oil and gas field machinery, worth $4.9 billion in 2011, which had more than quadrupled in size since 2001. ➳ Architectural and structural metals, worth $2.2 billion in 2011, had grown by 80 per cent since 2001. ➳ Pumps and compressors, worth $1.6 billion in 2011, had risen 65 per cent since 2001. ➳ Boilers, tanks and shipping containers, worth $1 billion in 2011, had risen 72 per cent since 2001. ➳ Machine shops’ products, worth $927 million in 2011, had risen 120 per cent since 2001. ➳ Heating, ventilation and air conditioning equipment, worth $432 million in 2011, had risen 56 per cent since 2001.
38 | summer 2013
alberta’s machinery and fabricated metals industry contributed $5.2 billion to alberta’s gdP in 2011, up from the high of $4.6 billion set in 2006. the industry includes about 1,700 companies that employ about 43,000 people. SOURCE: STATISTICS CANADA
About 13 per cent of the businesses that comprise the sector have more than 50 employees. Reurink says that although no reliable estimates are available for the primary metals or the transportation equipment sectors, it is estimated that these sectors had in excess of $2 billion in combined revenues in 2010 and employed about 7,000 people. Some subsectors, such as structural steel fabrication and pressure vessel manufacture, are especially concentrated in the metro Edmonton area. Manufacturing accounted for about 10 per cent of the capital city area’s GDP in 2010, and was worth an estimated $5.2 billion, according to the City of Edmonton. Although the metro region’s manufacturing sector is diverse, with 13 subsectors making up two per cent or more of the manufacturing pie, a pair of subsectors account for almost 40 per cent of the overall sector—fabricated metal products (23 per cent) and machinery (15 per cent). The Canadian Institute for Steel Construction (CISC), the Alberta Pressure Vessel Ma nufacturers’ Association (APVMA), and the Alberta government were prime movers behind the formation of ASM. Among their goals was the development of an analysis of both steel fabrication capacity and costs in Canada. A study, which is focused on structural steel, bridge work, carbon steel (non-pressurized) plate work and open web steel joists, is currently nearing completion. “The study came about to see what the capacity was in Canada and to present the evidence of that capacity,” says Tareq Ali, director of marketing at CISC.
As one would expect, structural steel fabrication, which has such a critical role in oilsands development, is a major part of the province’s metals fabrication output. Also not surprisingly, Alberta, and the Edmonton region in particular, punch well above their weight in this sector. Alberta’s installed capacity for structural steel fabrication is somewhat over 200,000 tonnes per year, according to a recent draft of the final report capacity, which researchers at the University of Alberta are preparing for release by CISC. The preliminary numbers suggest Alberta has greater structural steel fabrication capacity than Ontario (159,000 tonnes per year) or Quebec (135,000 tonnes). At least 150,000 tonnes of Alberta’s 200,000-plus-tonne capacity is located in the Edmonton area, says Paul Zubick, Alberta regional chairman for CISC and chair of ASM.
CENTRE OF ATTENTION This and other numbers support the view that the Edmonton metro region is a major centre for structural steel fabrication. As already noted, metals fabrication contributed about $2.2 billion to Alberta’s GDP. Given that Edmonton accounts for around three quarters of this output, the Alberta capital compares well with a major industrial hot spot at the heart, some would say, of the giant U.S. oilpatch—Houston, Texas. The metro Houston area, which has a population of about six million, had a GDP of $3.9 billion in 2010 for its fabricated metal product–manufacturing sector, according to the U.S. Bureau of Economic Analysis. Metro Edmonton’s output, with a population base of 1.2 million, was slightly less than half Houston’s GDP figure for this sector. Another angle also provides a view of the region’s capacity. Suncor Energy Inc.’s now-cancelled Voyageur upgrader project would have required about 44,000 tonnes of structural steel. “That would have been needed over a period of two years and would have used about