Healthy corporate earnings are a significant driving force for office furniture consumption. Canadian business profits (pre-tax) rose by a whooping 18.3% in 2004 and another 10.6% last year. Unfortunately, corporate profitability might be affected by the strength of the Canadian dollar. Aktrin estimates that pre-tax profit growth in Canada could drop to about 6.1% in 2006 and even lower next year.

Governmental expenditures have been growing at an average annual rate of 3.3% in 2005. In view of Canada's continued budget surplus, it is likely that government investments may grow a bit faster in the years to come. This bodes well for the office furniture industry considering the large number of desk-bound jobs in governmental offices.

Average annual office furniture sales in Canada (at retail prices and including recycled furniture) showed steady growth throughout this decade. Last year's growth stood at 10.3%, lifting the market to a value of C$4.8 billion. Due to the deteriorating corporate profitability, Aktrin believes that growth this year will be only in the 5.8% range and raise the market value just above the C$5 billion mark.