History of Industrial Development



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Albert Faucher et Maurice Lamontagne

Économistes, professeurs d’économie, Université Laval

(1953)


History of Industrial
Development.”

Texte d’une intervention
au Symposium du centenaire de l’Université Laval.

Les 6 et 7 juin 1952.

Un document produit en version numérique par Mme Marcelle Bergeron, bénévole

Professeure à la retraite de l’École Dominique-Racine de Chicoutimi, Québec

et collaboratrice bénévole

Courriel : mabergeron@videotron.ca


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Jean-Marie Tremblay, sociologue

Fondateur et Président-directeur général,

LES CLASSIQUES DES SCIENCES SOCIALES.

Un document produit en version numérique par Mme Marcelle Bergeron, bénévole, professeure à la retraite de l’École Dominique-Racine de Chicoutimi, Québec.

Courriels :marcelle_bergeron@uqac.ca; mabergeron@videotron.ca
Albert Faucher et Maurice Lamontagne

Économistes, professeurs d’économie, Université Laval


History of Industrial Development.”
Un article publié dans l’ouvrage sous la direction de Jean-Charles Falardeau, Essais sur le Québec contemporain. Essays on contemporary Quebec. Chapitre I, pp. 15-37. Québec : Les Presses de l'Université Laval, 1953, 260 pp. Textes recueillis par Jean-C. Falardeau lors du symposium du centenaire de l’Université Laval tenu à l’Université Laval les 6 et 7 juin 1952.

[Autorisation formelle accordée le 30 novembre 2010, par le directeur général des Presses de l’Université Laval, M. Denis DION, de diffuser ce livre dans Les Classiques des sciences sociales.]


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REMERCIEMENTS

Nous sommes infiniment reconnaissants à la direction des Presses de l’Université Laval, notamment à M. Denis DION, directeur général, pour la confiance qu’on nous a accordée, en nous autorisant, le 30 novembre 2010, la diffusion de ce livre dans Les Classiques des sciences sociales.

Courriel : denis.dion@pul.ulaval.ca

PUL : http://www.pulaval.com/

Jean-Marie Tremblay,
Sociologue,
Fondateur, Les Classiques des sciences sociales.
20 octobre 2011.

Albert Faucher et Maurice Lamontagne

Économistes, professeurs d’économie, Université Laval
History of Industrial Development”.

Un article publié dans l’ouvrage sous la direction de Jean-Charles Falardeau, Essais sur le Québec contemporain. Essays on contemporary Quebec. Chapitre I, pp. 15-37. Québec : Les Presses de l'Université Laval, 1953, 260 pp. Textes recueillis par Jean-C. Falardeau lors du symposium du centenaire de l’Université Laval tenu à l’Université Laval les 6 et 7 juin 1952.

Table des matières


History of Industrial Development

par Albert Faucher et Maurice Lamontagne

Introduction
1. Period of slow development : 1866-1911.

2. The new era of industrialization

3. Conclusion

COMMENTS

O.J. Firestone


[23]

ESSAIS SUR LE QUÉBEC CONTEMPORAIN.

Essays on Contemporary Quebec.

Symposium du centenaire de l’Université Laval, 6-7 juin 1952.


History of Industrial
Development.”

Albert Faucher et Maurice Lamontagne

Économistes, professeurs d’économie, Université Laval


Introduction




Retour à la table des matières

An analysis of the social impact of industrialization in Quebec, like this symposium, should be seen against abroad historical background. Accordingly, this first chapter will deal with the time-space aspects of certain potent factors in the evolution of Quebec's industry. Due to the scarcity and, in many instances, the complete absence of statistical data, our approach has to be non-quantitative. On the other hand, scientific investigation of this topic has been scanty. Hence the interest as well as the difficulty of mapping a pioneer exploration on such unchartered seas while raising questions conducive to further inquiries into, and to more elaborate interpretation of Quebec's economic development during the last century.

An interpretation of long-term industrial changes in Quebec is nonetheless possible. At the outset, one is reminded of the frequent statement that this province has been very slow in developing its industrial structure in comparison with other regions in North America. The statement is true, if one refers to the longest phase of our economic history, up to 1939. During the century 1839 to 1939, employment in manufacturing industries in Quebec rose by only a little more than 200,000. Yet, one must then immediately realize that Quebec has experienced an employment increase of exactly the same magnitude during only the short space of time between 1939 and 1950. Its relative industrial growth, during these last eleven years, has been ten times as great as what it had been during the preceding century and higher than that of Canada as a whole.

In what term must such a development be interpreted ? The most frequent interpretation suggested is that Quebec's relative economic « backwardness » is chiefly related to the influence of specific cultural factors. But, is such an interpretation justified ? [24] If it is, it would be rather difficult to account for the recent rapid growth, unless cultural forces are assumed to have undergone a profound change in orientation. We submit that this explanation does not seem acceptable. Cultural forces have not changed their direction and if, during a certain period, our economic evolution seems to have been determined by their influence, it is because it could not follow any other course at that particular time.

The explanation of industrial development propounded in this study is quite different since it refers mainly to economic and geographical factors. Our postulate is that one cannot understand this evolution without constant reference to the location factors prevailing in each period and to the elementary fact that Quebec is part of the North American continent. The study covers the last century and is divided into two parts concerned with two characteristic stages of our industrial evolution.

1. PERIOD OF SLOW DEVELOPMENT :


1866-1911.


Retour à la table des matières

The first period begins during the sixties of the nineteenth century. In order to understand the subsequent evolution, one must review briefly the situation which prevailed during that period.

This early or pre-industrial period can be identified with the commercial era. Its upward trend started at the beginning of the nineteenth century, with the Napoleonic wars. The two main articles of commerce were wood and grain and the main points of economic development were located along the Atlantic seaboard. In the United States, Boston, New York, Philadelphia and New Orleans were very active and were in a position to develop some consumers' goods' industries.

During the same period, Quebec was leading the way in Canada, its economic development being centered around Quebec City and Montreal. Thus, the historical prominence of Quebec in the development of Canadian economic life coincides in this era with a phase of commercialism and is due to the economic significance of the St. Lawrence waterway 1. Apart from providing easy access inland and permitting new settlements along the lowlands and the [25] river valleys, the St. Lawrence was primarily a commercial route supporting a traffic system, a sort of water-spout to the upper areas. From this function, the lower stream areas derived their prosperity. Quebec City, in particular, experienced a very active commercial life completed by a rapidly developing industrial structure resting mainly on shipbuilding. Economic and geographical factors were favouring that region and the population tried its best to profit from its advantageous position. Thus, during this early period, Quebec did not have a behaviour of its own. Its cities, like other North American seaboard centers, participated very actively in the prosperity brought about by commercialism.

A series of factors were to bring this period to an end and to disrupt the old arrangement : free trade in England, the end of our Reciprocity treaty with the United States 2, the deepening of the St. Lawrence and the construction of the canals. Undoubtedly, the, most important factor which accompanied the passage from commercialism to industrialism was the substitution of steel for wood as the basic economic product of industry and the construction of the railroads was the decisive element in this change. In the shipbuilding industry, the shift was made possible by the introduction of the steam engine. Thus a new era was beginning during which coal and iron would be the primary factors conditioning economic development. Thereafter, only those regions where coal could be found would experience rapid progress 3.

These technological improvements implied a change in the relative importance of the locational factors and a displacement of the center of economic gravity in North America. In the United States, during this first period of industrialism, the seaboard cities producing mostly consumers' goods passed to a rank of second importance. New York was the only exception because of railways converging thereto as toward a year-round sea-harbour and a financial center. Boston and Philadelphia receded and lost much of their strategic importance. With the iron age, the Appalachian coal fields were to assume a significant role. Pittsburgh emerged as a steel city to be linked later with the Minnesota iron range.

[26]

These changes had their counterpart in Canada. The seaboard cities lost their locational advantages resting on the old commercialism and Quebec was deprived of its prior importance as a land of lumbering and shipbuilding. The President of the Board of Trade in Quebec City summarized the situation as follows : « At one time, our great industry in Quebec was shipbuilding, in which trade we then excelled. This branch of industry gave employment to a well trained and hardy race of carpenters. It was a fine sight during those winter seasons to see our shipyards booming with the sign of life and activity... Unfortunately, with the progress of science and civilization, this industry, which was that upon which we chiefly depended, had to make way for more modem necessities 4 ». Without coal and iron and without technological know-how in the iron works, « the hardy race of carpenters » was confronted with a lay-off.



In Canada as well as in the United States, economic activity moved toward the center of the country. In this new region of industrialism, southern Ontario was strategically located with respect to water-borne and railway traffic. It was adjacent to the Appalachian coal fields and could command the cheapest routes to the western hinterland. To these advantages was added a decisive factor, the tariff walls which according to geographers played « a vital role in causing manufacturing to be more important on the Canadian side than otherwise would be the case 5 ». Thus the Great Lakes sub-region of Ontario emerged as the Canadian wedge into the United States and forged ahead in stride with the Pittsburgh-Cleveland sub-region of the manufacturing belt. The importance of tariffs in this development cannot be too much emphasized. In the words of Bruce Hutchison, the wedge « is physically almost an island surrounded by lake and river. Economically it is still more insular behind a chinese wall of tariffs 6 ».

Thus the decadence of Quebec's economic prominence was not a regional incident. It was a much wider phenomenon which affected the whole continent and which was due to the passage [27] from a regime of mercantilism to a system of industrialism based upon coal, steel and steam.

Within the new industrial arrangement which emerged, Quebec was not in a position to develop an industrial economy. The only locational advantage which remained was a surplus of labour, either left over or drawn from the countryside and in any case peaceful and dependable. Yet this advantage was not important because labour could always move. Nonetheless, Quebec had, like New England, to adapt itself to the new situation and the two regions followed the same solution, which probably was the only possible one in any case. Quebec joined in with the « sweating-system » industry belt of the continent at the time when Ontario was related to the tool-producing and steel industry belt.

At that time, there did exist mining quarries in Quebec, especially in the Eastern Townships, where asbestos mining began in 1877. This industry developed slowly, producing 10,000 tons in 1895 and employing 700 workers : but it was only after the first decade of this century that it embarked upon large scale operations to contribute more than 70 per cent of the world's production.

In fact, however, the early industrial era in Quebec was to rest on shoe factory, textile mills, sawmills and some railway rolling-stock milling in Montreal. It is interesting to note that most of these industries were to a large extent artificial in the sense that like those of Ontario, they needed tariff protection 7. The boot and shoe industry emerged in 1847 in Montreal and in the mid-sixties in Quebec City, and attained a position of dominance in the early eighties. In 1880, the famous Bresse shoe factory could turn out as many as 3,000 pairs of shoes per day. At the end of the century, no less than 3,000 workers were employed in the industry in Quebec City alone 8.

The textile industry also was rapidly growing, especially, in the last quarter of the century. Mills were, established in Valleyfield in 1874, Montreal in 1875 and 1882, Coaticook in 1879, Chambly in 1881, Magog in 1884 and Montmorency Falls in 1889. Several of these mills were merged and in 1905, Dominion Textile Company became the leading concern. The Whitehead interests were established [28] in Three Rivers in 1907 and in Shawinigan Falls in 1909. At that time, the industry provided employment to over 8,000 workers in the province 9.

In general, it is noticeable that the manufacturing pattern of the thirty-year period extending from 1881 to 1911 rests mostly on miscellaneous materials, vegetable and animal, and especially on textile, leather, log and lumber products. Throughout the period, the relative importance of the groups comprised in the pattern remained about the same, with the exception of shoe-making which somewhat declined after 1900, owing to rising costs of labour. It is useful to emphasize that such an economy developed against background of tariff and cheap labour. As for the economy as a whole, it was predominantly agricultural at the end of the century. On the basis of a total production estimated at $150,000,000, agriculture contributed 65 per cent, forestry 25 per cent, manufacturing 4 per cent, fishing and mining about 2 per cent respectively.

Thus, Quebec lived through a long period of profound disequilibrium. At the time when its industrial structure experienced a crisis of adaptation and was developing very slowly, its population tended to increase at a fast rate. Its birth rate has been paralleled with that of Rumania in the early part of this century, as indeed it could have been in the nineteenth with that of the most prolific nations of the western world 10. It was, beyond any doubt, the outstanding feature of the Quebec community at that time that it would so rapidly multiply with so little opportunity for commercial or industrial employment. This phenomenon, which had cultural origins, was to carry important economic implications.

This natural growth, higher though it may have been than the growth of capital accumulation, did not disquiet authorities, State and Church alike, who rather encouraged further proliferation. A solution to the disequilibrium had to be found, however. The only possible answer, at the time, was the encouragement of agriculture and colonization because there was no other opportunity for employment. Thus agricultural expansion coincided with the teachings of a traditional philosophy of rural life ; but it cannot be said that it resulted from these teachings : there was nothing else to do. In any case, colonization societies were organized. [29] Duvernay's slogan: « Emparons-nous du sol » was resumed so as to give it a definite connotation of nationalism : « Emparons-nous du sol, c'est le meilleur moyen de conserver notre nationalité 11» Agriculture was made functional to nationalism – or to religion, as stated by a curé at the time: « The road and the chapel together are colonization 12. »

As early as 1820, however, agriculture had occupied the best arable land ; with the exception of the Lake St. John and Abitibi regions, it had reached its optimum point of expansion covering the St. Lawrence lowlands and the arable patches of river valleys 13. The stony and boulder-strewn areas of the St. Maurice, Mattawin, Maskinongé, as also those on the table-lands of the Etchemin and Chaudière, not to cite those in the midlands of the Lower St. Lawrence region, should in the opinion of experts, have been kept forested. This is not to say, of course, that agricultural expansion over those areas did not fulfil any function, but rather to suggest that they could have served some alternative use in a more efficient manner.

The possibilities of agricultural expansion were much too limited to fill the gap between the rate of population growth and the rate of industrial development, so that large-scale emigration became a necessity. The surplus population could not easily move toward Ontario because the absence of technical knowledge in iron works would have made it very difficult to find employment there. On the other hand, New England needed additional manpower for its labour force was moving to the East-Central states. This was precisely the direction which the majority of Quebec emigrants followed. It is estimated that about half a million people left Quebec for New England in the second part of the last century 14.

From the above considerations, it can be inferred that the economic evolution of Quebec during the 19th century has been primarily conditioned by geographical and economic factors [30] inherent in the North-American system of political economy. During that period, Quebec was closely associated with New England and had a similar economic fate. Both these regions had played a leading role in the times of commercialism ; with industrialism, New England lost its economic prominence to the East-Central states and Quebec to Ontario. Finally, the two regions reacted in the same way to economic change, that is, by concentrating on labour-oriented industries. Cultural factors had nothing to do with that evolution and with the relative lethargy of Quebec's industry in comparison with that of Ontario : this difference is explained by the simple fact that Quebec, in the steel economy of that period, had no coal and no iron and was located too far from the Appalachian coal fields.

The only phenomenon which was specific to Quebec was its population problem. Agricultural expansion and emigration were the only possible solutions. That is why at the end of this period Quebec was primarily agricultural not by choice but through sheer necessity. Another feature of Quebec's economy was that its industry, with the exception of sawmills, was not based upon the exploitation of its natural resources, but on cheep labour and on the exploitation of the consumers' market. That is why it needed tariff protection to survive and it was mainly dependent for its prosperity and expansion upon the agricultural sector which provided the market. This last feature was quite paradoxical for a region which was not naturally destined to be agricultural.

2. THE NEW ERA


OF INDUSTRIALIZATION


Retour à la table des matières

With the beginning of the present century, new trends appeared in the Quebec economy. Again, this region remained closely associated with the North-American continent, but, for the first time in its history, it showed a profound difference in behaviour from New England. During the period of commercialism, our economic evolution had paralleled the development of the United States ; in the early phase of industrialism, Quebec had to fight for its survival against the pervasive economic influence of the East Central States. With the new era, it was definitively integrated with the North-American system and its economic development was based upon the resource pattern of the whole continent. 31] In other words, Quebec's natural resources were called upon to fulfil a definite function and a specific need. While the development of Southern Ontario had been a mere counterpart of American industrialization, Quebec's industrial growth was designed to complement it.

Several factors are at the origin of the fundamental change which was about to happen in Quebec's economic picture. First, and perhaps the most important, was the depletion of certain resources and the insufficient availability of other factors in the United States 15. Pulp-wood, copper and iron are good illustrations of this situation. Secondly, steel kept its prominence, but lost some of its relative importance or other metals were used as substitutes in several fields. Moreover, aircraft did for aluminum what the railroads had done for steel. Thirdly, coal receded from its dominant position as a source of power and water became a cheaper substitute. Thus hydro-power exerted an increasing locational pull for new industries.

As can be readily understood, this evolution involved deep changes in the relative importance of the locational factors and, this time, Quebec was strongly favoured by the new orientation of economic development. In order to understand why, it must be realized that the Precambrian Shield, which is the dominating feature on the map of this continent, comprises about eighty per cent of Quebec's territory. This huge expanse of land which lies north of the St. Lawrence (and which long remained foreign to the ruralist wing in this land of Quebec) had derived its early significance from fur trading and lumbering. Later on, with the decline of these trades, it receded from this pristine importance to a position of nuisance. It was qualified as a liability by railroad promoters. For the reasons already indicated, the old industrialism did not work out the economic integration of the Precambrian territory with what was then known as Quebec's mainland. The rugged Shield remained mysterious and, for the casual observer, comprised a useless expanse. With the new era, however, it was gradually realized that the so-called liability contained immense [32] forest resources, rich mining deposits of all sorts and tremendous potential of hydro-power. The new industrialism would effect the economic integration of the Precambrian territory with the North-American continent.

In choosing the year 1911 as a dividing line between the first and second phase of industrialization, it should not be thought that Quebec immediately assumed the aspect of an industrial landscape. The new orientation had already started before that date and was to develop slowly except in the 1920's and since 1939. Throughout the first two decades of the century, the course of economic events offers little to suggest that labour-oriented industries alone had altered Quebec's industrial structure. It was only when a number of material and/or power-oriented industries were married to the polygamous hydro-electric concern and when the two processes, old and new, joined together in the upswing of the 1920's that industrialization did challenge Old Quebec. This recent trend, capped as it was by a tremendous war and postwar expansion, has been spectacularly magnified in the last decade.

It should also be emphasized that in this new evolution Quebec, quite naturally, lagged behind Ontario because of its previous period of stagnation and its less favourable geographical position in respect to the industrial belt of the United States. As early as 1900, the Ontario Government put an embargo on export of pulp-wood to the United States which obliged Americans to build new plants in that province. Quebec arrived at the same decision only in 1910. Quebec also shared with Ontario in respect to metal, mining and refining, but after a much more considerable lag. In Ontario, mining discoveries were made at Sudbury and Cobalt in the course of railroad construction. Then Cobalt supported expansion toward the clay belt into the Porpicune and Kirkland Lake areas 16. From there, mining operations extended to the Quebec gold belt where the first strikes were hit before the building of the railroad. Thus, for various reasons, the occupation of the Precambrian area in Ontario and in Quebec represent two distinct phases of economic expansion, but, for the first time, both developments were moving in the same direction and they responded to the same American impulse.

[33]

The main events of the new era in Quebec are too well known to necessitate a detailed account. Its first signs appeared with the emergence of what has been called the twin industry, that is, hydro-electricity and pulp and paper. Then came the aluminum, the mining, the chemical and the aircraft industries. The changes which occurred during this period can be measured by a comparison of the relative importance of the industrial groups between 1920 and 1941. In round figures, agriculture, in 1920, contributed 37 per cent of Quebec's production, and manufacturing 38 per cent. Next came forestry with 15 per cent, construction 4 per cent and mining 3 per cent. In 1941, the position of these groups was respectively : manufacturing 64 per cent, forestry 11 per cent, agriculture 10 per cent, and mining 9 per cent.



Although this comparison between 1920 and 1941 reveals decisive changes in the industrial structure and a rapid progress toward industrialization, the period of fastest development has been the last decade. The following statistics, prepared by the Department of Trade and Commerce in Ottawa, sum up the story. As was already stated at the beginning of this study, employment in manufacturing doubled from 1939 to 1950. This increase, in absolute terms, is equal to the growth witnessed during the whole century ending with 1939. In addition, during this last decade, gross value of production doubled in real terms, while investment tripled. Out of every ten people looking for work, in 1939, 1.5 could not find a job, while in 1950 unemployment was negligible. Before the war, 2.5 persons worked on farms, but now only 2 are engaged in farming. During the same period, employment in cities, towns and villages increased from 6 to 8. Of these, three persons at the two dates were employed in commercial, financial and service occupations. Three persons found employment in industry in 1939 and 5 in 1950. Of these, one person worked in primary industries at the two dates, but employment in manufacturing, electric power and other utility undertakings rose from two to four persons 17. The chief contributions to the rising importance of manufacturing were, by order of relative importance, electrical apparatus, transportation equipment, wood products, iron and steel, pulp and paper and primary textiles.

[34]


During the period under review, the rate of industrialization in Quebec has been higher than that of Canada as a whole. Since 1939, in volume terms, output of manufacturing industries rose by 92 per cent in Quebec and by 88 per cent in Canada, while new investment in manufacturing increased by 181 per cent in this province and by only 154 per cent in the whole country 18. Similar statistics for the other Canadian provinces are not readily available to permit comparisons at this level. The rate of development for Ontario is probably still higher than it is for Quebec, but if there is any difference, it is certainly much smaller than it was during the previous decades. If we now look into the future, it is evident that Quebec's prospects are excellent. If we consider only its immense area and the amount of its natural resources not yet exploited, it would not be surprising if its rate of long term development would become the highest in Canada before long. During the period of expansion toward the North, Quebec may well regain the supremacy it had lost in the course of the development toward the West. This forecast assumes, of course, that economic trends will not be tampered with by political or other factors.

3. CONCLUSION



Retour à la table des matières

In concluding we must recall again that this study was intended to describe industrial development in Quebec in such a way as to permit an analysis of its social implications. The main attempt has been to show that Quebec's industrialization had nothing specific to do with, and was not fundamentally influenced by its cultural environment ; that, rather, it was a mere regional manifestation of the overall economic evolution of the North-American continent.

It is the task of the other contributions to this symposium, to investigate how industrialization has altered the cultural pattern and has changed the orientation of social institutions. In view of those contributions, it seems fitting to stress the main features which can be gathered from the historical introduction.

First, Quebec's industrial development has been North-American. Quebec's economy has never behaved in an autonomous and isolated way. On the contrary, it has always felt very deeply the impact [35] of the North-American evolution. Its development has been mainly a response to change affecting the whole continent. Thus conceived as a part in a larger unit, Quebec cannot be said to be backward or forward economically. In an economy of coal and steel, when the locational factors were not favourable, it developed less rapidly than other regions in a more advantageous position. On the other hand, when these factors became favourable, progress was immediately felt.

Secondly, Quebec's development is now based upon its natural resources and no longer on cheap and « reliable » labour as some propaganda would have us believe. In the early phase of industrialization, as we have seen, the main types of industries were labour-oriented and produced consumers' goods ; industrial expansion depended to a large extent upon the agricultural sector which, for that very reason, could not progress. Today, the situation is reversed. Economic development is now focussed around several basic industries exploiting the natural resources of the Precambrian Shield. In this industrial sector, labour is not cheap ; it is not even always reliable according to some employers. In spite of that, this care of new industries has become the dynamic element in Quebec's economy. Its influence is deeply felt by the old types of labour-oriented industries and agriculture is now dependant upon the industrial sector. Thus a new equilibrium is being worked out which will rest much more than the old one on Quebec's natural advantages.

Thirdly, Quebec's expansion is characterized by large-scale and monopolistic industries. In most cases, large-scale operations were required by technological conditions ; pulp and paper, aluminum and aircraft industries are good illustrations of this situation. In a lesser number of cases, they can be explained by the potentialities of the market and by the desire for bigness. However, economic power is much more concentrated than the size and the number of plants would lead us to believe. All kinds of methods have been used to create monopoly power and even the group of old industries such as textiles, shipbuilding, tobacco and breweries has participated in the movement toward higher concentration. Thus it is more and more difficult to enter into established industries.

Finally, industrialization has not been a realization of the main ethnic group in this province. In view of the purpose of this [36] study, this is a very important feature of Quebec's economic development. It is very difficult to get good estimates on the importance of foreign investments in this province and reliable information concerning foreign control in the different industries. Very often legal arrangements contribute to conceal the true economic relationships.

It is possible to say, however, that American ownership and control are widespread. The erection of American subsidiaries in Quebec can be traced to the early years of Macdonald's national policy. Up to 1900, 25 American firms established branches in the Quebec territory. It has been estimated that during the next fifteen years, 43 per cent of the investments in new facilities came from the United States. It is reported that in 1934, a third of the capital invested in Quebec was American. This trend may well have been strengthened during and after the war. Projects now under way to exploit titanium iron deposits at Allard Lake and iron ore in what has been called the « New Quebec » indicate that the flow of American capital into Quebec is still very strong. This movement is explained first by the fact that early industrialization in the United States had permitted the creation of a large reserve of capital. Part of this capital, in turn, was invested in Quebec because the Americans needed our natural resources or looked for an access to a protected Canadian market.

This does not mean, however, that the Americans have been the only ones to finance and direct Quebec's industrialization. Even Ontario has made its contribution, mainly in the mining industry. It remains true, however, that economic development in Quebec has been financed, directed and controlled from the outside. From this point of view, it can be said that this province suffers from absentee ownership and entrepreneurship.

Another outstanding fact is that French Canadians in particular have played a minor role in the field of industrial development. Up to now, this fact has been explained mainly in cultural terms. A discussion of such an explanation would lie outside the scope of this paper. We would like to submit however that its soundness has been too readily accepted and that inadequacies of our educational system cannot very well account for the situation, because it is well known that successful businessmen in French Canada as elsewhere, at least in the past, were not necessarily university [37] graduates. It has also been alleged that our cultural characteristics were responsible for our lack of interest in business matters or were incompatible with large scale enterprise. We would suggest to sociologists to look for a more materialistic and commonplace explanation and to go back to economic realities both past and present.

Finally, it must be pointed out that in such a system where absentee ownership and entrepreneurship prevail, administrative functions have been delegated to a local management with limited responsibilities and predominantly English-speaking. This situation creates serious problems, especially in labour relations. In this field where the human aspect is so important, economic conflicts tend to be aggravated by ethnic tensions. These conditions are apt to breed such grievances as were expressed by the voice heard by Maria Chapdelaine forty years ago : « Strangers have surrounded us whom it is our pleasure to call foreigners ; they have taken into their hands most of the rule, they have gathered to themselves much of the wealth ; but, in this land of Quebec, nothing has changed. »

Nothing has changed, indeed, for the core of French Canada has remained the same. It may be asked, however, what actually constitutes the core of French Canada, but it is the task of sociologists to answer the question. The message gathered by Maria Chapdelaine further reads : « In this land of Quebec naught shall die and naught shall suffer change. »

How, and to what degree may this land of Quebec have suffered change in the last forty years and to what extent can it be further modified ? For some changes have to be introduced in order to keep the nationalistic resentment from being transformed into a fight against capitalism. This paper may have shown from the basic standpoint of economy and geography that some change has been introduced into Quebec and is presently being introduced. Still, the question is being asked whether social institutions have been able to go ahead or keep abreast of the change. The voice of Peribonka echoes now as a challenge to the spirit of scientific investigation and it suggests that perhaps, in the last forty years, more change has been wrought over this land of Quebec than many local philosophies may dream of.

Albert FAUCHER


and Maurice LAMONTAGNE

[38]


History of Industrial
Development.”

COMMENTS

O.J. Firestone

Retour à la table des matières

This introductory essay is a penetrating analysis of a vital aspect of the development of the Province of Quebec : how a region, with as bountiful and diverse resources as this province, for many generations led a life of tranquility until, with the beginning of the twentieth century, the powerful forces of new industries on the march began to transform a largely pastoral and commercial economy into a community rapidly advancing in technology and bursting with energy and drive. Far from having spent itself after half a century of industrial expansion, there pulsates today through the width and breadth of Quebec's economy an inbounding vitality and innate creativeness which holds bright promise for greater economic achievements in the next half century.

The authors of this chapter have provided us with a very helpful perspective of Quebec's industrial development. They have pointed to both the strength and weaknesses inherent in Quebec's industrial structure, and thus have given us a sound basis for concluding that Quebec's economic future is bright indeed, notwithstanding the handicaps of ever-changing markets and human attitudes. I would rank this paper as an historical document worthy of Laval's centenary celebration.

The way in which it takes stock of Quebec's economic progress and points to the potentialities that appear to exist reminds me of a set of documents with a similar purpose written close to 300 years ago, about the time when the Seminary from which this University grew was founded : the reports of Jean-Baptiste Talon, one of France's foremost emissaries to the infant colony of New France. He, like many others after him, was greatly impressed by the vast resources that were awaiting development and the great possibilities that appeared open to the enterprising and the imaginative individual. New France might have had a population of only 3,200, but Talon's enthusiasm knew few limits. In trying to fire the imagination of France's rather hard-to-impress Minister of Finance, Colbert, – Ministers of Finance do not seem to change much over the ages – he wrote in October 1665, shortly after his arrival, that New France had foundations upon which might be [39] built, « an empire, or at the least a powerful nation » (free translation). Perhaps, however, even an inveterate optimist like Talon might be surprised to see how his little settlement has flourished.

Perhaps two other general comments might be appropriate. First, industrialization of Quebec is a complex and in certain aspects a controversial subject that, in its economic ramifications, has hitherto been explored only little. By taking a historical-economic approach and by treating the subject in a systematic and particularly lucid manner, Faucher and Lamontagne's paper is in the truest tradition of the high quality of work which over the last decade or more has become so characteristic of the Social Sciences Faculty of Laval under the inspiring leadership of Father Lévesque.

Secondly, Lamontagne and Faucher appear to be keenly aware that an economic assessment of national or regional development requires the setting of certain rigorous criteria, the testing of hypotheses against reality, and the drawing together of salient conclusions into a framework of economic analysis which explains not only the inter-relationship of the forces at work but also the reasons for their existence. The authors have given us a more limited paper, and I think their decision has been a wise one. By giving us a progress report of some of their work and thinking, they make us look forward with keen interest to their next contribution. Also, by concentrating on a qualitative approach rather than by combining it with a quantitative assessment they are opening up a wide field for further research and study that could be particularly constructive and illuminating.

To turn now to the subject-matter of the paper, the authors have brought out very clearly the weaknesses and strengths of Quebec province as an industrial region. One of the principal weaknesses, which is fortunately losing importance, has been the distance from economical supplies of coal and iron and from markets. The principal strengths have been the large labour force and the abundant supplies of non-ferrous metals, timber and waterpower. Advances in technology and the fact that United States supplies of forest products and minerals have not kept pace with the growing demands of that market have brought into play a number of natural advantages of the region. As a result, the industrial development of Quebec has been much more rapid in [40] the years since the beginning of this century than in the preceding period.

Thus Quebec has been carried on changing tides of fortune. It is interesting to recall an earlier period in the seventeen thirties under the « ancien régime » when Quebec even had an iron and steel industry – the St. Maurice Forges. Of course, we are told that the Forges operated at a loss and had to be financed out of the pockets of the King of France. But then we are also told by a contemporary that the manager and staff of the Forges were in very affluent circumstances, so perhaps this was simply an early example of the dangers of nationalized or subsidized industry. At any rate, in time the ample local supplies of bog-iron and charcoal passed and, with them, the Forges.

Today, the pendulum is swinging back again and Quebec is on the verge of becoming a major producer of iron ore, and I think one of the questions we will want to ask ourselves is whether this may become the basis of a steel industry. I am looking forward to an interesting discussion on this point because I know one of our authors has some pretty strong views on the subject 19.

There is another important aspect of Quebec's industrial growth and that is its inter-relationship with and contribution to Canadian economic development. Lamontagne and Faucher emphasize that the new trend towards rapid industrial development became apparent in the Province of Quebec at the beginning of this century, and that progress was particularly marked after 1911. The authors make the point that the initial impetus for this development is to be found in the natural resources pattern of the province, which assumed new meaning after 1900 because it provided the raw materials and power needed to service the growing North American and overseas markets and to meet the requirements of technological advances which the Atlantic nations were achieving with remarkable persistence and speed. Looking at industrial development in its broadest sense, most of us will probably agree that these were two of the major factors.

These influences, however, were operative also in other regions of Canada even though they were affecting economic development of the various parts of the country to a different degree, at times [41] one region pushing ahead of another, or one industry overtaking another. This competitive race between regions and industries was facilitated greatly by an economic climate encouraging free enterprise and individual initiative which resulted in many new discoveries, new wants and new production techniques. These endeavours were assisted by government economic policies which for the most part played a supplementary role to private endeavour.

The period that our authors describe as the time in which Quebec's industrial revolution occurred coincides with the period of most rapid economic expansion of Canada as a whole. To this national development Quebec has made a major contribution, but equally the industrial boom in this province has drawn a great deal of strength from the growth of the Canadian market and the ability of Quebec's industries to provide in both peace and war many of the strategic materials and manufactured products which this country and its principal trading partners required.

By 1900, Quebec's population of about 1.6 million comprised about 30 per cent of Canada's total and this proportion has changed little over the last fifty years. But economic development since the turn of the century was rapid not only in Quebec but particularly so in the western parts of the country. In fact, in relative terms, the growth of the Prairies and British Columbia was much more rapid than that experienced in the more settled regions of the central and Atlantic provinces. The reaction of the wheat economy in the Prairies and the mixed forestry, mineral, hydro power and fishing economy of British Columbia meant not only a great deal of wealth for these parts of Canada, but also increasing opportunities for established business in the eastern parts of the country.

While Quebec was about able to maintain its position, simply by growing as rapidly as the rest of the country, Ontario was not able to match this rate of expansion. The growth of the West has meant that Ontario, which had 41 per cent of Canada's population in 1900, now makes up only 33 per cent of the total, or just 4 per cent more than Quebec. Thus the shift to the West has been an historical force whose course has not been altered over the last fifty years even by the attractive economic opportunities that developped in Ontario, Canada's most industrialized province.

In response to the need to serve the Canadian and regional markets which are now 3½ times what they were population wise [42] in 1900 and perhaps over 5 times in terms of real purchasing power, Quebec's industries expanded tremendously. Briefly, industrial establishments today have doubled in number, but what is more important, many of them are now vast arsenals using mass production methods and large amounts of intricate capital equipment against the small workshops of 1900 which used traditional production methods that had changed little over the centuries. The industrial labour force is now 3½ times what it was fifty years ago, and it produces an output 6 times greater in real terms. At the same time, workers in Quebec have been able to reduce hours worked per week from an average of about 61 hours to some 43 hours, or by close to 30 per cent.

Output per man-hour per industrial worker in manufacturing has risen on an average by 3 per cent per annum in Quebec over the last fifty years but, because of the decline in hours worked, the output per man-year has only risen by something like 1½ per cent. Comparable average increases for Canada as a whole are approximately 3¼ per cent per man hour and 2 per cent per man year. The obvious question is : Why the difference ?

The first reaction might be that Quebec's industries are using less capital than industries in other regions. But interestingly enough, speaking in average terms, this is not the case. Land, buildings and machinery and equipment per employee in manufacturing (book value) is estimated at $6,500 for Quebec in 1950, or about $1,000 higher than the Canadian average. The explanation for this, of course, is the prevalence of such high capital-using industries in the Province of Quebec as pulp and paper, chemicals, and hydro installation forming part of manufacturing operations.

Another explanation that one encounters frequently is that Quebec's industrial worker may be less efficient than workers in other parts of the country. It is difficult to generalize on this subject since usually those making this claim single out an individual operation to support their contention. But the fact remains that many of Quebec's native sons and daughters are now working in other parts of the country, or in the United States for that matter, and that, when language difficulties have stood in the way and have been overcome, their skill and performance will frequently match if not exceed that of their co-workers.

[43]

Perhaps I can suggest two reasons for the slight difference in the long-term rate of output per man hour as between Quebec and other regions. One reason may be the industrial structure of this province, which in some respects is unique in Canada. It combines mass production industries of the first order requiring comparatively little manpower in relation to value of output, such as the large capital-using industries which I have just mentioned, with a number of other industries which require a large labour force in relation to the final value of commodities produced, e.g. textile, leather goods and tobacco industries. How concentrated these last mentioned industries are in the Province of Quebec is indicated by the fact that 87 per cent of workers employed in tobacco production were in Quebec, with the proportion for the boot and shoe industry being 59 per cent and for textiles and clothing about 57 per cent 20.



Secondly, Quebec is the only province in Canada with more females than males. Availability of a large reserve of female workers has encouraged the growth of light manufacturing (and service) industries. Even though the tendency towards equalization of pay for men and women has been growing, some differential still exists and this will be reflected in the gross value of the final product.

There are other reasons for the differences in industrial productivity and some of these are implied in the preceding study. As to the somewhat wider difference in the rise in output per man year, there is, besides the varying rate of hourly productivity, some variation in the trend with respect to the number of hours worked per week. The average Quebec industrial worker works about 43 hours per week, as against the national average of 41½ hours 21. But this gap has been closing steadily. I mentioned earlier that hours worked per week have declined in Quebec by close to 30 per cent since 1900. The national average decline was less, about 25 per cent, and it was still less in a number of other provinces.

There are interesting implications in the difference just reviewed regarding real earnings of industrial workers, their standard of [44] living and the regional market their purchasing power supports. Perhaps the main impression I would like to leave is that I fully agree with the view of the authors of this essay that there are strong economic reasons why the Province of Quebec has such a diverse variety of, and in many respects such basically different industries, ranging all the way from a handicraft enterprise to the most up-to-date and world-competitive mass production concern. Thus, a study of the process of industrialization in Quebec is really a study of contrasts. In fact, if we knew more about the economic impact of the changing structure of Quebec's industries we might find a number of explanations for things that are presently ascribed, for want of more specific knowledge, to « cultural » forces or to « traditional » sentiment.

In conclusion, I might raise three questions which the Faucher and Lamontagne paper brings to mind.

First, how serious a disadvantage has the distance from coal, iron and markets been and does it account as much for the failure of certain industries to locate in Quebec as the authors suggest ? Or are there other factors such as insufficient local initiative and inadequate financial resources ? And when high incomes in the more recent period made it possible to accumulate large savings in the region, have Quebec's peculiarly characteristic investment preferences reduced the availability of native capital for industrial development ?

The second question relates to the influence of non-economic factors on the rate of industrial expansion, which the authors feel should not be over-emphasized. With this I agree. But I wonder whether whatever influence such factors might have had would not also extend to establishing the pattern of Quebec's industries as it has developed over the last half century.

The third question refers to one aspect that has been covered only slightly in the paper : What has been the influence of government economic policies (federal, provincial and municipal) on Quebec's industrial expansion ?

O.J. FIRESTONE



Fin du texte


1 D. G. CREIGHTON, The Commercial Empire of the St. Lawrence 1760-1850, Toronto, Ryerson, 1937 ; A. R. M. LOWER and H. A. INNIS, Select documents in Canadian economic history, 1788-1885, Toronto, The University of Toronto Press, 1933.

2 A. R. M. LOWER, The North American assault on the Canadian forest, Toronto, Ryerson, 1938, cc. XIII-XIV.

3 J. R. SMITH North America : its people and the resources, New York, Harcourt, Brace & Co, 1940 ; C. L. WHITE and E. J. Foscue, Regional geography of Anglo-America, Prentice Hall, 1950.

4 Address of Joseph Shehyn Esq. M.P.P., Feb. 1880, p. 24.

5 C. L. WHITE and E. J. FOSCUE, op. cit., c. XIII.

6 Bruce HUTHCHISON, The Unknown Country, c. VII, Toronto, Longmans, 1948.

7 It is well known that iron works in Montreal were developed because of federal subsidies to coal movements from the Maritimes.

8 SHEHYN, op. cit.

9 Rapport de la Commission royale d'enquête sur l'industrie textile, Ottawa, 1938.

10 Statistical Year-Book, Province of Quebec, 1914.

11 Le Canadien émigrant, par douze missionnaires des townships de l'Est, Québec, 1851.

12 Questionnaire, in Report of the select standing Committee on agriculture, immigration and colonization, Journals of the legislative assembly of the Province of Quebec, 1867-68.

13 J. BOUCHETTE, Topographical dictionary of the Province of Lower Canada, London, 1832 ; Georges VATTIER, Esquisse historique de la colonisation de la province de Québec (1608-1925), Paris, 1928.

14 G. LANCTÔT, Les Canadiens français et leurs voisins du sud, Montréal, Valiquette, 1941.

15 J. A. GUTHRIE, The newsprint paper industry, Cambridge, Harvard University Press, 1941, c. II ; ELLIOTT and others, International control in the non-ferrous metals, The Macmillan, N. J., 1937, Part II ; D. H. WALLACE, Market control in the aluminum industry, Cambridge, Harvard University Press, 1937.

16 H. A. INNIS, Settlement and the mining frontier, Toronto, Macmillan, 1936, cc. VII-VIII.

17 See chapter II, infra, Recent industrial growth, Table 3.

18 Ibid., Table 4.

19 Quebec : Rich Resources for Industry, by Maurice LAMONTAGNE, Public Affairs, Dalhousie University, Halifax, December 1948, pp. 256-262.

20 Based on employment figures of industries with 15 or more employees, as of June 1951.

21 See following chapter, Recent industrial growth.


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