Why has Canada’s productivity taken a nosedive?

In today’s The Big Story podcast, over the past several years, measures of economic productivity have seen Canada tumbling. First slowly, then rapidly. Once nearly at par with the United States, we’ve fallen far behind them — and by some measures we’re one of the developed world’s least productive countries right now.

Trevor Tombe is a Professor at the University of Calgary’s Department of Economics and Director of Fiscal and Economic Policy at The School of Public Policy. He also a contributor at thehub.ca.

“Our peer economies today are Spain, and Italy. That’s kind of where Canada is in terms of its overall productivity performance. And the US, meanwhile, is this year on track to produce about 50 per cent more per person than Canada does,” said Tombe. 

How did this happen? Which industries are lagging behind and dragging us down? How much of this fall was within Canada’s control, and how much was due to external factors? And when we speak of a country’s or a province’s “productivity”, what exactly are we measuring, and how?