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Hours worked and labour productivity in the provinces and territories, 2014

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Released: 2015-11-30

Labour productivity in Canada (2007 dollars)

$50.10 per hour

2014

2.5% 

(annual change)

Business productivity increased in every province and territory in 2014 except Yukon, Newfoundland and Labrador and New Brunswick. Nationally, business productivity grew 2.5%, following a 1.2% gain in 2013.

Growth in business productivity was above the national average in Nunavut and British Columbia, while Alberta, Quebec, Ontario and Saskatchewan were similar to the national growth rate. Nunavut led all regions in 2014, recording a 10.0% increase following the development of a new mine. Conversely, the sharpest decline was in Yukon (-10.0%), the result of substantial decreases in mining and construction. Among the provinces, productivity gains were lowest in the four Atlantic provinces and in Manitoba.

Chart 1  Chart 1: Labour productivity in the business sector by province and territory, 2014
Labour productivity in the business sector by province and territory, 2014 

In 2014, real gross domestic product (GDP) of businesses increased in every province and territory except Newfoundland and Labrador, New Brunswick, and Yukon. Hours worked were up in 7 of the 13 provinces and territories. At the national level, hours worked increased 0.3%, after rising 1.2% in 2013. The biggest gains were in Yukon (+7.8%), the Northwest Territories (+6.2%), Alberta (+2.1%) and Prince Edward Island (+1.5%).

The average compensation per hour worked in the business sector rose in every province. Newfoundland and Labrador (+7.9%) recorded the largest increase in Canada for the third consecutive year. Hourly compensation continued to decrease in the Northwest Territories and Yukon in 2014, while in Nunavut, it rose a substantial 14.3%.

Hourly compensation for Canada as a whole increased 3.6%, compared with 3.0% in 2013. Newfoundland and Labrador, Manitoba, Alberta and British Columbia posted a lower increase in 2014 than in 2013.

Atlantic provinces

Business productivity in Newfoundland and Labrador declined 1.5%, after it posted the largest growth in the country in 2013 at 6.4%. The decline in 2014 resulted from a productivity decrease in goods-producing businesses. Real GDP of businesses fell 3.2%, a sharper decline than the decrease in hours worked (-1.7%). Hours worked decreased 2.7% in goods-producing businesses and 1.0% in service-producing businesses.

In Prince Edward Island, business productivity increased 0.4%, matching the growth in 2013. The increase in the real GDP of businesses (+1.9%) mainly reflected increases in output of food products manufacturing and in tourism-related services. At the same time, the 1.5% increase in hours worked was the result of a 3.1% gain in service-producing businesses. On the other hand, hours worked decreased 1.5% in goods-producing businesses.

In Nova Scotia, business productivity rose 1.5% in 2014, after increasing 2.1% in 2013. The gain in 2014 reflected a 0.8% increase in real output of businesses, combined with a 0.4% decline in hours worked. A 0.3% increase in hours worked in service-producing businesses was more than offset by a 2.3% decrease in goods-producing businesses.

Business productivity in New Brunswick was unchanged in 2014, after increasing 0.8% a year earlier. In 2014, a 2.1% decline in goods-producing businesses was offset by a 1.2% increase in service-producing businesses. The 0.7% decline in real GDP mainly reflected reduced activity in goods-producing businesses, especially in manufacturing and mining. The 0.8% decline in hours worked was in both goods-producing businesses (-1.2%) and service-producing businesses (-0.5%).

Central Canada

Business productivity in Quebec rose 2.5% in 2014, after increasing 0.5% a year earlier. The productivity growth of service-producing businesses (+2.6%) in 2014 outpaced that of goods-producing businesses (+1.8%) for a sixth consecutive year.

Real output of businesses (+1.4%) rose at a slightly faster pace than in 2013, mainly because of gains in manufacturing, metallic ore mining, transportation services and wholesale services. Hours worked in the business sector decreased 1.0% in 2014, after increasing 0.6% in 2013.

Productivity in Quebec's manufacturing rose 3.7% after increasing 0.9% in 2013. Hours worked in manufacturing declined for a second consecutive year, while output rose 3.2%, after edging down 0.2% in the previous year.

In Ontario, business productivity increased 2.4% in 2014, after decreasing 0.2% in 2013. Real output of businesses in Ontario rose 2.9%, driven by the manufacturing sector. Hours worked in the business sector edged up 0.4%, after increasing 1.7% in 2013. Hours worked were up 0.1% in goods-producing businesses and 0.6% in service-producing businesses.

Productivity increased 4.2% in the manufacturing sector in Ontario after decreasing 1.0% a year earlier. Manufacturing output was up 3.7% in 2014, while hours worked were down 0.5%.

Western provinces

Businesses in Manitoba increased productivity by 1.3% in 2014, following a 2.7% gain in 2013. The real value added of businesses increased 2.3%, while hours worked rose 0.9%. Hours worked in goods-producing businesses (+3.0%) were up sharply, while they declined 0.3% in service-producing businesses. Manufacturing, construction and mining and oil and gas extraction were the main contributors to the increase in hours worked in 2014.

In Saskatchewan, business productivity rose 2.3%, following a 2.4% gain a year earlier. The real GDP of businesses increased 1.6%, after rising 6.8% the previous year. Hours worked declined 0.7%, after posting a 4.4% gain in 2013. Goods-producing businesses, in particular in agriculture, forestry and manufacturing, were the main contributors to the decline in hours worked in 2014.

In Alberta, growth in the productivity of businesses was 2.6% in 2014, an identical rate to that recorded in 2013. The growth in both real GDP and hours worked of businesses were the largest of all the provinces. The real GDP of businesses increased 4.7%, while hours worked (+2.1%) rose for a fifth consecutive year, up 2.8% in goods-producing businesses and up 1.7% in service-producing businesses. The largest gains in hours worked in Alberta were in construction, mining, quarrying, and oil and gas extraction, transportation and warehousing services as well as retail trade.

Chart 2  Chart 2: Hours worked in the business sector by province and territory, 2014
Hours worked in the business sector by province and territory, 2014

In British Columbia, business productivity grew 3.0% in 2014, following a 2.0% gain a year earlier. Real output of businesses rose 3.7%, after increasing 2.0% the previous year. Hours worked were up 0.7%, after being stable in 2013. Hours worked in goods-producing businesses rose 3.0%, while hours worked in service-producing businesses edged down 0.1%.

The territories

In Yukon, business productivity declined 10.0% in 2014. This was the third consecutive annual decrease. The 2.9% decline in the real GDP of businesses was mainly the result of lower activity in mining, quarrying and oil and gas extraction, construction and wholesale trade. On the other hand, hours worked increased 7.8% in 2014, the largest increase in the country.

In the Northwest Territories, business productivity (+1.6%) resumed growth in 2014, after a contraction in each of the four preceding years. After rising 5.4% in 2013, real output of businesses was up 8.0% in 2014, largely as a result of increased activity in diamond mining and construction. The gain in hours worked slowed from 8.5% in 2013 to 6.2% in 2014, because of a deceleration in the growth of hours worked in service-producing businesses.

In Nunavut, business productivity increased 10.0% in 2014, following two annual declines. This was the largest gain in the country. The real GDP of businesses increased 4.8%, mainly as a result of sharp gains in activity in mining, quarrying and oil and gas extraction and engineering construction following the development of a new mine. In contrast, hours worked (-4.8%) posted the sharpest decline among the provinces and territories in 2014.



  Note to readers

Revisions

This release incorporates revisions on provincial and territorial labour productivity and related variables in the business sector by industry from 2007 to 2013 and an update to 2014. These revisions are consistent with those incorporated in the provincial and territorial economic accounts and the provincial and territorial gross domestic product by industry, released on November 10, 2015.

This release also takes into account historical revisions to the Labour Force Survey, published in January 2015, and revisions to the Survey of Employment Payroll and Hours, released in March 2015.

Revised data from 1997 to 2006 will be released at a later date.

Productivity measure

Labour productivity is a measure of real gross domestic product per hour worked. Productivity gains occur when the production of goods and services grows faster than the volume of work dedicated to their production.

Economic performance, as measured by labour productivity, must be interpreted carefully, as these data reflect changes in other inputs, in particular capital, in addition to the efficiency growth of production processes. As well, growth in labour productivity is often influenced by the degree of diversity in the industrial structure. As a result, labour productivity tends to be more volatile in the smaller provinces.

For the purpose of this analysis, as in the national labour productivity releases, productivity measures cover the business sector. It is important to note that real production (used to measure productivity) is based on value added measured at basic prices, not market prices, which is consistent with the detailed framework by industry.

As well, the service-producing business sector and its component, real estate, rental and leasing, exclude the imputed rent for owner-occupied dwellings, as there are no data on the number of hours that homeowners spend on dwelling maintenance services.

Products

The System of macroeconomic accounts module, accessible from the Browse by key resource module of our website, features an up-to-date portrait of national and provincial economies and their structure.

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; STATCAN.infostats-infostats.STATCAN@canada.ca) or Media Relations (613-951-4636; STATCAN.mediahotline-ligneinfomedias.STATCAN@canada.ca).

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