Labour productivity, hourly compensation and unit labour cost, second quarter 2026
Released: 2026-09-03
Second quarter 2026
1.0% 
(quarterly change)
Productivity rebounds in second quarter
The labour productivity of Canadian businesses increased 1.0% in the second quarter, the largest increase since the rise in the second quarter of 2020 (+7.7%), induced by the COVID-19 pandemic. The increase in the second quarter of 2026 resulted from a rise in the value added in the business sector, while hours worked decreased.
Chart 1
Business output increases, while hours worked edge down
Goods-producing businesses lead overall growth in productivity
The growth in business sector labour productivity in the second quarter was driven by a rebound in goods-producing businesses, which increased 1.7%, following two quarterly declines. Meanwhile, productivity in services-producing businesses grew 0.7%, the fourth consecutive quarterly rise.
Overall, productivity increased in 12 of the 16 main industry sectors in the second quarter. Mining, oil and gas extraction, wholesale trade and manufacturing were the top contributors to growth in labour productivity, while utilities and retail trade recorded the largest declines in the quarter.
Hours worked soften
Total hours worked in the business sector edged down 0.1% in the second quarter, after rising 0.4% in the previous quarter. A decrease in the average hours worked (-0.3%) offset a gain in jobs (+0.2%).
In the second quarter, hours worked in goods-producing businesses decreased 0.5% following increases in the previous two quarters. In contrast, hours worked in service-producing businesses were largely unchanged in the second quarter.
Growth in unit labour costs accelerates
In the second quarter, compensation rose 1.5%, outpacing growth in real gross domestic product, which resulted in a 0.6% growth in unit labour costs for businesses. This marked the fifth consecutive quarterly increase in unit labour costs for businesses. Unit labour costs represent the labour costs required to produce one unit of output.
Learn more about labour productivity
To learn more about productivity, the factors that influence it and why it matters for Canadians, listen to the Eh Sayers podcast episode, "Why economists are sounding the alarm on productivity."
Sustainable Development Goals
On January 1, 2016, the world officially began implementing the 2030 Agenda for Sustainable Development—the United Nations' transformative plan of action that addresses urgent global challenges over the following 15 years. The plan is based on 17 specific Sustainable Development Goals (SDGs).
The release "Labour productivity, hourly compensation and unit labour cost" is an example of how Statistics Canada supports the reporting on the global SDGs. This release will be used to help measure the following goal:
Note to readers
Revisions
With this release, data were revised back to the first quarter of 2025 at both the aggregate and industry levels. The revisions incorporate the latest quarterly gross domestic product (GDP) by income and expenditure data and monthly GDP by industry data, released on August 28, 2026.
Productivity measures
The term productivity in this release refers to labour productivity. For the purposes of this analysis, labour productivity and related variables cover the business sector only.
Labour productivity is a measure of real GDP per hour worked.
Unit labour cost is defined as the cost of workers' wages and benefits per unit of real GDP.
The approach to measuring real output in the business sector differs from the one that is used in the estimates by industry. For the business sector, output is measured using the expenditure-based GDP approach at market prices, while the measure of output by industry is based on the value-added approach at basic prices.
All the growth rates reported in this release are rounded to one decimal place. They are calculated with index numbers rounded to three decimal places, which are now available in data tables.
All necessary basic variables for productivity analyses (such as hours worked, employment, output and compensation) are seasonally adjusted. For information on seasonal adjustment, see Seasonal adjustment: Concepts and interpretation, 2026.
Products
The document "Labour productivity measurement at Statistics Canada," which is part of Latest Developments in the Canadian Economic Accounts (13-605-X), is available.
The Economic accounts statistics portal, accessible from the Subjects module of the Statistics Canada website, features an up-to-date portrait of national and provincial economies and their structures.
The Latest Developments in the Canadian Economic Accounts (13-605-X) is available.
The User Guide: Canadian System of Macroeconomic Accounts (13-606-G) is available.
The Methodological Guide: Canadian System of Macroeconomic Accounts (13-607-X) is available.
Contact information
For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; infostats@statcan.gc.ca) or Media Relations (statcan.mediahotline-ligneinfomedias.statcan@statcan.gc.ca).
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