Growth Of Service Sector In Canada Essay


Describe the growth of the service sector in Canada in terms of the shift from primary and secondary (goods producing) sectors. Identify the key categories and distinguish between those that pay well and those that do not?


Growth of service sector in Canada

The deindustrialization, which reaches its high time in 1970 in countries like Canada, United Kingdom and the United States, is continued in the twenty first century. Between 2000 and 2010, the employment in Canadian manufacturing sector declined by 22.5 percent. During this time, the share of manufacturing employment in total employment fell to 10.35 percent from 15.6 percent. The displacement of workers engaged in heavy industries including steel production, papermaking factories, car assembly resulted from introduction of high-end technologies like computer-assisted system, industrial robots; flexible manufacturing accelerates the growth of service sector in Canada. The workers who lose their jobs in these industries have no other option but to take low skilled jobs in services sector with a much lower payment (Enderwick, 2013). In this time the though the general trend was a decline in manufacturing and parallel growth of the service sector, some of heavy industries still alive and growing. In Canada, some manufacturing company though growing but producing goods with lesser workers.

In an economy service sector is described as a sector where communication with customer constitutes an important share of labor process. The professions include arts, retail trade, hospitality industries, entertainment and others (Flynn & Bauder, 2015). In Canada, non-professional service workers comprises 28 percent share in the service sector. The economic activities in Canada are broadly divided in two categories- good producing and service sectors. These two categories include three major sectors – primary, secondary and tertiary sector.

Key categories of services sector and corresponding payment

Within the service sector in Canada, there are 15 sub sectors as descried below

Wholesale Trade: The Wholesale trade includes merchant wholesaler, products in farms, building materials and supplies. The weekly average wage for this category is $1,109.65.

Retail Trade: The dealers in motor vehicles part, electronics and appliance store, clothing and accessories to clothing and gasoline stations bring under this category. The average wage for this group is $542.27.

Information and cultural industries: Publishing industries, telecommunication, broadcasting and motion pictures and sound recording are included in this category.

Transportation and Water housing: Air, rail, water transport, truck and postal service.

Finance and Insurance: Central Banks.

Professional, scientific and technical service: Professions like legal, Accounting, Computer system design, architectures are included in these category.

Management of Companies

Administrative and support

Educational service, health care, social assistance, public administration, accommodation and food services

Within Canadian service sector, there are both private and public services. The private services include insurance, real estate, company management, financial and credit unions (Enderwick & Enderwick, 2013). The public services include health, education, and social assistance, administration in provincial, federal, municipal.

In 2014, the average weekly salary in the service sector was $871. When categorized as wages $1000 in week and $52000 in a year as benchmark of high wage, out of 15 industries in service sector seven rank as services with higher salary. These are wholesale trade, scientific and technical profession, company management, insurance and finance, warehousing and transportation, public administration, information and cultural industries (Fortin & Lemieux, 2015). In the low paying group having wages less than $600 per week there are three industries namely retail trade: accommodation of food and services; art, recreation and entertainment.


Enderwick, P. (Ed.). (2013). Multinational Service Firms (RLE International Business). Routledge.

Enderwick, P., & Enderwick, P. (2013). Some economics of service-sector multinational enterprises. Multinational Service Firms,(London and New York, NY: Routledge, 1989), 3-34.

Flynn, E., & Bauder, H. (2015). The private sector, institutions of higher education, and immigrant settlement in Canada. Journal of International Migration and Integration, 16(3), 539-556.

Fortin, N. M., & Lemieux, T. (2015). Changes in wage inequality in Canada: An interprovincial perspective. Canadian Journal of Economics/Revue canadienne d'?conomique, 48(2), 682-713.

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