For lack of available arms, Quebec furniture manufacturers plan to move their household goods to Mexico.
Posted yesterday at 6:00 a.m.
Far from being limited to the furniture sector, this trend towards “offshoring” seems to affect the entire manufacturing sector, confirms Véronique Proulx, President and CEO of Manufacturiers et Exportateurs du Québec (MEQ).
Thus, according to a survey recently conducted by the Association of Furniture Manufacturers of Quebec (AFMQ) among its 83 members, 33% said that they were “studying the possibility of producing” outside the province. The survey did not look at the specific manufacturing locations coveted by companies, but the city of Juárez, in northern Mexico, seems to attract several, underlines Gilles Pelletier, president and CEO of the AFMQ.
The labor shortage and the “abnormally long” delays – 16 months, according to the AFMQ survey – before the arrival of temporary foreign workers are pushing furniture manufacturers to consider other avenues. “The disgust is so high that people are starting to think about producing elsewhere,” says Mr. Pelletier bluntly, during an interview with The Press. We receive relocation messages. It’s worrying. It’s something you didn’t hear often before. »
“In Mexico, they have maquiladoras. These are free zones often near US customs. Juárez is one of those places.
“There are financial incentives for companies to set up shop there and they have access to a labor force which is abundant,” he explains, adding in the process that manufacturers who move to countries of Andrés Manuel López Obrador do not do it with “lightheartedness”.
Réjean Poitras, president and CEO of Amisco, which specializes in furniture made from metal, is one of those who had to make this heartbreaking decision. His company, whose head office is located in L’Islet, in Chaudière-Appalaches, has a plant in this same region, as well as in Saint-Pascal-de-Kamouraska and Shawinigan. However, Amisco, which produces 400,000 pieces of furniture annually, wants to continue its growth. The manufacturer is currently in final negotiations to lease production space in Juárez. The company wants to start production in early 2023.
“The objective is not to reduce our activities in Quebec,” insists Mr. Poitras. But we are seeing a drop in our production capacities, not because we are going to lay off people, because we are going to lose people who are going to retire and the difficulties of hiring will remain great for a long time. It is in this context that we are going to Mexico, to be able to maintain and possibly increase our production activities. »
The big boss of Amisco, which currently has 500 employees, believes that the provincial and federal governments are partly responsible for this situation since they are not speeding up the process allowing temporary foreign workers to land here.
We need more foreign workers, skilled and unskilled. It is essential that the worker integration process be much more fluid, much shorter and better supported in the regions.
Réjean Poitras, President and CEO of Amisco
In Sainte-Croix-de-Lotbinière, furniture manufacturer South Shore, which has two factories in Quebec, also has facilities in Juárez. But that’s not new. South Shore has been established there for a dozen years. Thus, half of the production is done here and the rest, on Mexican soil, explains Jean-Stéphane Tremblay, president and chief operating officer of the Quebec manufacturer, which specializes in online sales. “I can understand that there are some companies that are asking questions and wondering what they are going to do,” he admits.
“If we didn’t currently have a factory in Mexico, it is clear that settling there would be a solution to consider to alleviate the labor problem we are facing. »
South Shore recently welcomed 12 workers from its Juárez plant to Quebec to fill vacancies at the Coaticook and Sainte-Croix-de-Lotbinière facilities.
” It’s good for us. These are people we know who already work for our organization, underlines Mr. Tremblay. They know our processes, our machines. They arrive here and they can already work. We gave them French lessons in Mexico. We bought two houses to house them. »
Moreover, this “exile” is not without consequences, laments Gilles Pelletier. He mentions in particular the loss of investment and knowledge. Currently, 40% of furniture manufacturing in the country is done in Quebec. “History repeats itself,” he laments. This is what we have seen in other industries such as textiles. We end up with a service industry. »
“All the facilities we have, the equipment we have, will remain underutilized, adds Réjean Poitras. There are taxes to be paid in Quebec that will be lower. »
“There are a lot of players who may not have the means or the resources to settle elsewhere,” he continues. I think it can go as far as closing smaller players. »
This situation affecting the furniture sector does not surprise Véronique Proulx. According to a study published last fall by Manufacturiers et Exportateurs du Québec, 15% of companies surveyed say they have considered moving between 40% and 50% of their activities outside the province.
“It’s really a last resort,” she says. The federal and provincial immigration departments are not economic departments. We need the government to speed up the process [pour faire venir des gens ici]. »
Furniture manufacturing in Quebec
- 40% of furniture manufacturing in the country is done in Quebec
- The sector represents more than 20,000 jobs
- 500 companies
- 90% of Quebec residential furniture exports go to the United States