President Barack Obama’s push to make the United States “a magnet” for manufacturing jobs won’t end up bleeding jobs away from Canada, the U.S. envoy to Ottawa predicted Wednesday.
Rather, the initiative unveiled in Obama’s State of the Union address will prove to be a net gain for Canada’s battered manufacturing sector in the long run, U.S. Ambassador David Jacobson said in an interview.
“It’s just the reverse,” Jacobson said. “That’s what trade is all about. This is not a zero-sum game.”
Jacobson underscored his argument by pointing out that Obama visited a Canadian-owned North Carolina auto parts maker on Wednesday to kick-start his manufacturing push.
Guelph-based Linamar took over the Asheville, N.C., plant when Volvo shut down operations in 2010, cutting 200 jobs. Linamar has since hired back 168 people and expects that to reach 200 by year end, said president Jim Jarrell.
Jarrell said he’s impressed by Obama’s commitment to revitalizing manufacturing, especially considering his company has spent more than $85 million on the Asheville plant.
“When I was talking with the president, we had a short little meeting ... I said, ‘The way I look at this, I look at it like two brothers — we do what’s right for the family, and what’s right for our customers.“’
Jarrell accompanied Obama on a short tour of the plant before the president gave a speech.
“While they could have gone anywhere in the world, they saw this incredible potential right here in Asheville,” Obama said.
Jacobson said Obama chose the Canadian-owned plant to emphasize the importance he places on foreign investment helping to revitalize U.S. manufacturing.
“The more that they sell in North Carolina, they more they make in Canada,” said Jacobson.
“That’s what’s true about trade in general. Whenever anybody says, ‘Gee, the more that we sell here, the less than we can sell there,’ that’s just not the way it works.”
Jayson Myers, president of Canadian Manufacturers and Exporters, said a stronger manufacturing sector in U.S. is important for Canada because that’s its top customer base. But that doesn’t mean Canadian jobs aren’t potentially vulnerable.
“I’m really glad that the president focused on manufacturing,” said Myers.
Myers said Obama’s focus on strategic investments in technology and product development is something the Canadian government should be emulating.
“We also have to be careful because we have seen growing protectionism in the U.S., lots of Buy America restrictions in place. The president didn’t talk about repatriating jobs,” Myers cautioned.
“If they’ve got a strategy to repatriate jobs in manufacturing into the United States, Canada’s going to be the easiest place to repatriate those jobs from.”
A new study Wednesday highlighted the problems of Canada’s manufacturing sector.
The Business Development Bank said the number of mid-sized companies in Canada declined by 17 per cent from 2006 to 2010, from 9,370 to 7,814.
And it said that manufacturing was the hardest hit sector, with more than half of its mid-sized firms disappearing between 2001 and 2010 from 2,807 to 1,381.
Speaking in the House of Commons, Finance Minister Jim Flaherty said Canadian firms have rebounded in the last three years not covered by the study and since the end of the recession. “We have come back rather well in Canada,” he said.
During the State of the Union, Obama noted how after shedding manufacturing jobs for a decade, the U.S. has managed to bring 500,000 of those jobs back over the past three years.
“Our first priority is making America a magnet for new jobs and manufacturing,” he said.
“Caterpillar is bringing jobs back from Japan. Ford is bringing jobs back from Mexico. After locating plants in other countries like China, Intel is opening its most advanced plant right here at home. And this year, Apple will start making Macs in America again.”
Jarrell said the plant in Asheville is now making parts for Caterpillar and Volvo. And many of his company’s parts cross the 49th parallel repeatedly before they find their way into an engine or transmission.
He said he’s upbeat about the future, especially after Obama’s speech.
“We don’t look at this as a negative at all for Canada or the U.S. We’re a global company. We basically go where our customers want us, and that’s all over the world.”