OTTAWA (AP) -- Soaring prices for industrial products and robust demand for resource-based goods offset declines in some of Canada's key durable goods industries in 2007.
Overall, there was little change in both the volume and value of manufacturing sales.
Statistics Canada reports manufacturers posted a modest 0.4 percent increase in sales to $613.4 billion.
In constant dollars, factory sales were essentially flat, following a lackluster 2006 in which sales edged down.
Manufacturers had a mixed year in other respects in 2007: Employment fell by about 55,300 jobs and total hours worked declined 2.9 percent.
But the sector's labor productivity increased 1.9 percent last year, nearly four times the gain for the economy as a whole, and operating profits increased.
Manufacturers faced several major challenges, including the rising exchange value of the Canadian dollar and the weaker export market in the United States.
Events in the United States, such as the ongoing sub-prime mortgage situation and declining consumer confidence, weakened demand for Canadian-made goods in this market. But exports to other countries increased.
The food industry was still Canada's largest manufacturing industry last year in terms of sales. However, the petroleum and coal products industry surpassed motor vehicles for the first time to become the second largest.
On the negative side, sales by manufacturers of wood products plunged to their lowest level since 1996. Manufacturers of automobiles and trucks also continued to sputter, posting lower sales compared with 2006.