New York’s garment processing industry is in the midst of a massive comeback.
But a report from CIBC World Markets, a bank in Toronto, says the revival will take time, given the industry’s massive dependence on imported labour.
As the global supply of garment-fabrication workers has grown, the number of foreign workers has declined by more than a third over the past decade, according to a new report from the bank.
While the sector is expected to grow by 3 per cent a year over the next 10 years, it will need to be able to absorb that growth without having to rely on a significant increase in workers from outside the country, said Andrew J. Laskowski, senior vice-president of global development and research at CIBC.
“We don’t want to lose the supply chain,” he said.
In 2016, about 1.3 million Canadians were employed in the garment industry.
But the report found that a growing number of those jobs are now held by immigrants from Asia and Latin America.
Lacking the skills to perform their jobs effectively, the workers are increasingly leaving their homes and moving abroad, according the report.
“They are leaving the country for jobs they have no experience with, and they are finding it hard to find work,” said Laskowsky.
“The biggest challenge is getting workers back to their countries of origin, and we need to get people back to work.”
The International Labour Organization estimates that Canada lost nearly 5.2 million garment workers between 2009 and 2020.
About 8,400 of those were from the Middle East, Africa and Asia.
The number of international workers in Canada fell by almost 3 per to 1.5 million in 2016.
It’s estimated that about 5,000 of those workers were from Asia.
“There are a lot of people from the Gulf countries, from the Indian Ocean countries, the Middle Eastern countries, and a number of other countries that are going back to Canada to work,” Jankowski said.
But many are finding themselves at a disadvantage, he added.
“As a result of the loss of Canadian workers, there is a significant decrease in the demand for the garment-manufacturing sector,” the report said.
The economic downturn and rising demand have also made it difficult for businesses to find skilled workers.
Many companies have also lost money on their investments, leaving many struggling to make ends meet.
The CIBC report says that in 2016, the sector lost about $1.2 billion on its investments, a decline of 11 per cent from 2015.
The overall economy is expected shrink by about 2.5 per cent this year.
CIBC predicts that by 2020, the country will have a GDP of $16.3 billion, which is up 4.7 per cent on 2015.