A whopping 37% increase in service production in British Columbia led to a small gain of 4% in overall production volume across Canada for the fiscal year ended March 31, 2008, according to a sneak preview of the CFTPA annual report. Combined domestic and service production increased to $5.2 billion, from $5 billion the previous fiscal.

The total $5.2-billion production volume is divided into three sectors: foreign location and service production was worth $1.77 billion; production by independent Canadian producers was worth $2.3 billion; and in-house productions (such as news, sports and current affairs) generated $1.16 billion.

‘Production volume is solid, but it certainly isn’t growing,’ says CFTPA president and CEO Guy Mayson. ‘Over the last few years, production activity has plateaued in the $5-billion-plus range. I think we need a new strategy to take the content industry — which is potentially a huge growth sector — to the next level. The real economic potential is making a bigger impression on the international market.’

According to Profile 2009 — the CFTPA’s annual survey of production activity to be released this week at the group’s conference in Ottawa — the only sector that saw a marked boost in ’07/08 was the service industry, with a 23% increase to $1.77 billion.

However, that national increase can be attributed to a boom in B.C., where volume soared 37% to $1.1 billion in ’07/08.

B.C. continues to have some advantages over the rest of Canada, including many large studio spaces, a geographical advantage that includes a shared time zone with Los Angeles, U.S. producers’ familiarity with B.C. crews, and an increasingly competitive provincial tax credit — which increased from 18% to 25% for service shoots during this period.

‘Ontario and Quebec have faced competition south of the border from states like New York, Illinois and Michigan, which have all introduced significant tax credits,’ says Peter Leitch, chair of the Motion Picture Production Association of B.C. and president of North Shore/Mammoth Studios. ‘We don’t have that same level of direct competition in B.C. [because] the states south of us — like Washington, Oregon and Montana — haven’t developed their film industry to the same level.’

Nonetheless, the sharp increase in location shoots is surprising, given that during ’07/08 the Writers Guild of America staged a strike (November 2007 to February 2008) and the Canadian dollar continued to strengthen against the greenback. On top of that, the loonie was on par with the U.S. dollar for the first time in almost 31 years in September 2007.