Auto parts makers to shed 37,000 jobs this year, Conference Board forecasts

By The Canadian Press

OTTAWA - A new report says Canada's auto parts sector will be cutting its workforce to the bone this year because of the crisis in the assembly sector.

The Conference Board of Canada says auto parts makers will cut 37,000 jobs, or about one third of their workforce in Canada, as the North American industry undergoes massive restructuring.

The sector has been shedding jobs for years, but this year's losses are expected to top the total of the last four years combined.

Ontario will be hard hit by the job losses since the province has most of the parts companies.

The Ottawa-based think-tank says the sector will also record its second consecutive year of losses this year, totalling $173 million as a result of production cuts of 39 per cent. The parts makers lost $109 million last year.

Despite the cuts, the Conference Board says things are looking up for the industry.

Parts manufacturers are expected to return to a profitability in 2010 as U.S. demand for autos ramps up.

The think-tank says the sector will realize a profit of $212 million next year, building to over $1 billion in 2013, slightly more than where it stood in 2007.

As well, the sector is expected to start needing more workers starting in 2011.