| -

RICHMOND HILL, Ontario — While the checklist of progress made in the auto industry in the year since General Motors and Chrysler completed their bankruptcy processes is largely positive, there remains one particularly glaring weak spot, according to Dennis DesRosiers. He looked at data on Canada's auto-sector job market and called the situation "very ugly."

The number of auto manufacturing jobs has taken a nose dive in recent years and 2010 marked the lowest level of this sector's employment in 28 years, shared DesRosiers, president of DesRosiers Automotive Consultants.

He argued that halting this employment erosion and generating more auto jobs was the "critical reason" behind all the money given to Big 3 automakers by the Canadian and U.S. governments in the first place.

"Let's see now … GM and Chrysler appear to be making progress out of bankruptcy … check. Ford is picking up market share … check. Some import nameplate brands are yielding market position to Detroit … check," DesRosiers said.

"Cost of manufacturing vehicles at the Detroit 3 has been adjusted downward and is now more competitive with the new domestics … check," he continued. "The markets in Canada, Mexico and the USA are slowly returning to normal … check. We haven't noticed a supplier failure in months … check. Employment is returning to previous levels … NOT!"

DesRosiers added: "Oh no, say it ain't so, Joe. The most important political variable in the automotive equation and the critical reason that our collective governments dumped over $100 billion into the Detroit 3 (Ford got money to help meet new fuel efficiency requirements) was to arrest declines in jobs. Indeed to increase jobs in the automotive sector. I haven't looked at the U.S. or Mexico, but Statistics Canada has new employment numbers out for the year to date to the end of April, and they are ugly … indeed, very ugly."

Continuing on, he noted that Canadian employment in the four segments of the auto manufacturing industry (assembly; parts; machine, tool die and mould; motor vehicle body and trailer) reached an apex of 199,218 jobs in 2001.

The numbers for 2010 are down about 37.8 percent from that 2001 level. Moreover, auto manufacturing jobs have fallen year-over-year in each of the last five years and seven of the last nine.

Not to mention, the last time auto employment was this depleted was 1982.

And while the 7.2-percent year-over-year decline in 2010 is not as heavy as the 20.6-percent loss in 2009, this is no reason to celebrate, DesRosiers noted.

"The big loss was last year when over 34,000 jobs evaporated and panic reigned in Ottawa and Queen's Park. But any politician that planned to pull a George Bush and stand on a frigate and announce 'Mission Accomplished' had better wait for the next flight," he commented.

"Employment across all four industry sub-sectors continues to deteriorate this year," DesRosiers continued. "Close to 10,000 jobs have been lost compared to the identical period a year ago, and remember a year ago, the industry was in deep trouble. So to be down from the depressed levels of a year ago indicates that the automotive and parts sector in Canada, or at least the manufacturing side of the automotive sector, is in seriously bad shape."

Of the four sectors, the one that figures to be in the best health is the assembly sector, he pointed out. It dipped just 1.4-percent from a year ago to 36,294 jobs, and though this figure is off more than 37 percent compared to the 1999 crest, there is stability now and it is "no longer in a free fall," DesRosiers shared.

However, the parts sector is where the bulk of jobs have "always" been generated, and this segment in 2010 is down 9.1 percent year-over-year. Parts jobs have dipped in each of the last five years and seven of the last nine, as well.

"Employment in the parts sector peaked at just over 100,000 in 2001, but since that time, the auto parts sector has shed over 42,000 jobs with no end in sight," DesRosiers noted.

"And very troubling is the fact that one of the core capabilities in our automotive parts sector has always been its close link to the tooling sector, and with the auto parts sector in the toilet this has devastated the Canadian tooling sector," he added.

Looking at the MTDM segment in more detail, DesRosiers explained that this usually is the steadiest. Employment in this arena showed an increase of more than 10,000 jobs from 1991 to 2006.  However, this has now declined five straight years and is down to the level it was 19 years ago, he pointed out.

"And most disconcerting is that these are typically the highest skilled jobs in the automotive sector. Canada was never going to be able to hold onto low skilled jobs but high value added jobs seemed to be savable," DesRosiers noted. "If Canada can't hang onto high value-added jobs, then vehicle and parts manufacturing in this country is in serious trouble."

He added: "Politicians should be very worried. We are seeing the willowing away of our vehicle and parts manufacturing sector and I quite frankly don't see much ability for any politician to stop this. We don't even know why these jobs are disappearing and until we understand this issue, then any response by any government will just be a shot in the dark."