Historical The Canadian manu facturing industry may be said to have been born of the protective tariff of 1878. There were manufactures, of course, before that date. Iron working had been an industry in Quebec from the days of Frontenac, and the ship building yards of New Brunswick were famous half a century ago the world over. Prior to Confederation, however, the greater opportuni ties and more imperative tasks of agriculture forced manufacturing into the background, and such industries as arose were small and catered to local markets. Flour mills and saw mills -were the most numerous; tanning also was a flourishing industry. The woolen mills of Ontario in these early days were of considerable relative importance. In 1876, however, it was still possible for a captain of industry to de clare that "there isn't a manufacturer of us all who has not come up from five dollars." To this phase the tariff of 1878, which banished the policy of "incidental protection" and aimed to found a well-rounded manufacturing industry, was the end. A notable expansion set in with 1879 and lasted until 1882, after which the general stagnation accompanying the fall of prices told unfavorably. The "national policy" (as the protective scheme of 1878 was styled) may, however, be said to have doubled the extent of the industry within about a decade. It was not until after the end of the century that a like forward movement was repeated. Throughout the nineties, in fact, manufacturing no more than held its own, employing fewer wage-earners and paying out less for labor, though showing a gain in capitalization and value of products. With the opening of the 20th century, however, this was rapidly over come. Manufacturing within a decade nearly
trebled its capitalization; increased the number of its employees by one-half ; considerably more than doubled the amounts paid out in salaries and for raw materials, and increased the value of its product from $481,053,375 to $1,165,975,639. A strong tendency toward specialization and merger made itself felt after 1907, over 40 combinations having been made in the three years 1908, 1909 and 1910; it passed away, however, rather quickly, not having proved the success that was expected. The general expansion continued during 1911 and 1912, but sank back with 1913, being revived, though in a new direction, by the heavy orders for war materials that came from Europe shortly after the declaration of war in August 1914.* In the remarkable story of expansion, therefore, which constitutes the history of Canada during the 20th century, and which had its basis in the opening up of the Canadian west to agriculture and the building of rail ways on an unprecedented scale as feeders of the new territory, manufacturing contributes one of the most important chapters. With the growth of western agriculture the claim of the Canadian manufacturer to special favors under the tariff has been challenged with more in sistence than previously. Independently of fiscal policy, however, which has shown no tendency to fundamental change, it may be predicted with assurance that manufacturing will play an important role in Canadian de velopment, and that in many lines of products Canada bids fair to become one of the world's growing sources of supply.