The Canadian Space Agency has released its 2019 State of the Canadian Space Sector report which shows flat growth for the second year in a row.
The report, available below and online, is for the year 2018.
According to report, revenues for the Canadian space sector were $5.671 billion up from $5.595 billion for 2017. That translates into an increase of 1.3%. However, it should be noted that inflation for 2018 was 2.24% according to the Bank of Canada. That’s the second year in a row where inflation was higher than the increase in revenues. So while revenues are up, the costs associated in creating the additional revenue were also higher.
Of note, and to see how Canada fared compared to the aggregate revenues in 2018, the Space Foundation in its annual Space Report for 2018 reported global revenues exceeding US$400 billion for the first time at US$414.75, an 8.1% increase over the previous year.
One telling statistic from this years report is that the number of people employed in directly in the space sector and supply industry jobs actually declined by 4.5%, shedding 726 jobs. In looking at the workforce graph over the past five years we’re not seeing an increase in the workforce over time. However, I don’t think we need to be overly worried as those number should increase in future reports, though the Coronavirus might skew numbers for at least one year.
- Total revenues in the Canadian space sector reached $5.671B.
- In 2018, the space sector contributed $2.5B to Canada’s GDP and supported a total of 20,891 jobs.
- Business Expenditures on R&D (BERD) totalled $356M in 2018, a 2% decrease from the previous year.
- Canada’s top 30 companies accounted for 97% of revenues and 78% of the workforce in 2018.
- STEM workforce experienced a 3% growth in 2018, totalling 5,795 FTEs and accounting for 61% of the Canadian space workforce.
- While Ontario and Quebec had the highest space revenues, the Prairies experienced the highest revenue growth in 2018.
- Canadian space companies hired 741 employees, of whom 26% (196) were women and 74% (545) were men.
- With 6,152 FTEs, HQP* (employees with at least a bachelor’s degree) accounted for 64% of the workforce.
- In 2018, the upstream segment generated roughly $0.8B in revenues, while the downstream segment generated $4.9B in revenues.
- Canadian space exports increased by 7%, reaching $2.3B. The U.S. remained the main export destination, accounting for 57% of space export revenues.
- In terms of sectors of activities, 81% of revenues came from Satellite Communication. However, the Navigation sector experienced the highest growth year-over-year.
- R&D intensity for space manufacturing was 11 times higher than the average for manufacturing in Canada.
- Space sector organizations reported a total of 170 inventions and 53 registered patents.
- Ninety-four percent of Canadian space companies were SMEs in 2018; they accounted for 43% of Canadian space sector revenues and 31% of all employees.
- University and research centre revenues amounted to $109M, representing 1.9% of total revenue. They contributed 20% of the total space sector workforce with 1,909 full-time equivalents.
The British Columbia and Quebec data
In looking at revenues by region, B.C. and Quebec both had a substantial drop in revenues between 2014-2018.
In B.C.. part of that might be due to MDA ramping down of the RADARSAT Constellation Mission program as the satellites were finished and ready for launch in 2019. Urthecast also shed jobs and revenue in 2018.
In discussing B.C. the reports states “in 2018, British Columbia had revenues of $215M, a decline of 26% ($75M) over 2017 revenues. Domestic revenues declined by 35%, or $56M, from $158M in 2017 to $103M in 2018. Export revenues also declined by 15%, or $20M, from $132M to $112M between 2017 and 2018.”
“B.C. accounted for 4% of Canadian space sector revenues in 2018. There were twice as many upstream organizations in B.C. as downstream organizations. Upstream segment organizations generated 58% of the province’s space revenues and downstream segment organizations generated 42% of the province’s space revenues. B.C. is the only province where the upstream segment generates more revenues than the downstream segment.”
In discussing Quebec, the report states “revenues in Quebec declined by 5%, or $74M, in 2018, totalling $1 .5B. Domestic revenues decreased by 8%, or $97M, from $1 .3B in 2017 to $1 .2B in 2018; exports grew by 8%, from $266M in 2017 to $288M in 2018.”
“Quebec accounted for 26% of Canadian space sector revenues in 2018. Quebec had almost four times as many upstream segment organizations as downstream segment organizations, while revenues were heavily concentrated in the downstream segment (80%) rather than in the upstream (20%) .”
Revenue by markets and customers
Here’s some key points:
- Research, Engineering and Consulting amounted to $220M in 2018, a 13% growth ($25M) from 2017. This sub-segment accounted for 4% of total revenues in 2018.
- Space Segment Manufacturing amounted to $415M in 2018, a 20% growth ($69M) from 2017. It accounted for 7% of total revenues.
- Ground Segment Manufacturing amounted to $178M in 2018, a 53% decline (-$203M) from 2017. It accounted for 3% of total revenues.
- Satellite Operations amounted to $928M in 2018, a 5% decline (-$52M) from 2017 . It accounted for 16% of total revenues.
- Products and Applications reached $1 .4B in 2018, a 32% growth ($326M) from 2017. It accounted for 24% of total revenues.
- Services amounted to $2 .6B in 2018, a 3% decline (-$89M) from 2017. It accounted for 45% of total revenues in 2018.
One last statistics once again stood out, the domestic vs export revenues. While export revenues continue to increase, domestic revenues continue to fall. Is that going to continue and what does it mean? That and other questions still remain. We’ll explore them further in future articles as we parse the data, talk to the Canadian Space Agency and stakeholders.
* In the 2019 survey, the CSA made changes to the methodology used to calculate its workforce-related indicators, such as highly qualified personnel (HQP) . In previous years, HQP was measured as the number of engineers, scientists and technicians working in the space sector . As of the 2019 sur-vey, the number of HQP is instead measured as the number of space-related employees who have at least a bachelor’s degree . This methodological change allows the CSA to be more aligned with Statistics Canada’s definition of HQP, enabling comparisons with other sectors of the economy .