Canadian manufacturers have begun to retrench following the rapid run-up in the value of the loonie and substantial increases in the price of crude oil and other raw materials.

“Manufacturers are now anticipating lower production and employment levels in the coming months, resulting from dissatisfaction with the current levels of orders and inventories,” Statistics Canada said Thursday in its Business Conditions Survey for January.

That’s a contrast with what Stats reported in October. At that time the agency said manufacturers had not been as upbeat about hiring more workers since April of 1988.

But in January, the agency found that employment prospects were no longer positive.

“While 85% . . . stated that they would keep or add to their work force, 15% indicated that they expected to decrease employment,” the agency said.

The number stating they would increase production during the next three months stood at 13%, down eight points from October.

Thirteen per cent also indicated they would decrease first-quarter production.

Fourteen per cent said new orders were declining, a jump of nine points from October.

“The decrease in satisfaction with the level of orders received was not concentrated in any specific industry.”

Eighteen of 21 industries indicated lower satisfaction with current orders.

Sixteen of 21 indicated lower satisfaction with current unfilled orders.

And 75% reported in January that the current level of finished product inventories was about right, down from 78% in October.

The business conditions survey of about 4,000 manufacturers is conducted in January, April, July and October.