Estimates of multifactor productivity growth in the provinces, 2022
Released: 2024-06-11
Multifactor productivity in the business sector increased in Manitoba, Saskatchewan and Alberta and declined in all other provinces in 2022. For Canada overall, multifactor productivity rose by 0.6% in 2022.
The largest increase in multifactor productivity in 2022 was observed in Saskatchewan (+6.0%), followed by Manitoba (+4.0%) and Alberta (+2.9%). These increases coincided with the relatively high growth in real gross domestic product (GDP) in those provinces in 2022.
Chart 1
Multifactor productivity in the business sector, by province, 2022 and 2019 to 2022
Chart 2
Multifactor productivity and real gross domestic product in the business sector, by province, 2022
The largest declines in multifactor productivity in 2022 were in Newfoundland and Labrador (-5.5%) and Prince Edward Island (-3.2%). These declines were associated with relatively low growth in real GDP in those two provinces.
Multifactor productivity is one of the three components of labour productivity, the other two being capital intensity and labour skill upgrading. An increase in capital intensity arises from investment in equipment, structures and intellectual property that contributes to growth in labour productivity. Skill upgrading is measured by labour compositional changes toward workers who are more educated and more experienced. It captures the effect of an increase in worker skills from education and experience on labour productivity. Growth in multifactor productivity is often associated with technological change, organizational change or economies of scale.
Most provinces have little or negative multifactor productivity growth from 2020 to 2022, during the COVID-19 pandemic
The growth in multifactor productivity was volatile during the pandemic period of 2020, 2021 and 2022. Over this period, businesses recovered and adapted to the shocks of the pandemic.
From 2019 to 2022, multifactor productivity declined slightly by 0.1% at the national level, and it changed little in all provinces, except Saskatchewan and Newfoundland and Labrador. Multifactor productivity rose 1.0% per year in Saskatchewan from 2019 to 2022. In Newfoundland and Labrador, multifactor productivity declined 3.5% per year over that period.
Did you know we have a mobile app?
Download our mobile app and get timely access to data at your fingertips! The StatsCAN app is available for free on the App Store and on Google Play.
Note to readers
This release uses the database on provincial multifactor productivity and related variables for business sector industries from 1997 to 2022. Data include multifactor productivity, value added, capital input and labour input in the aggregate business sector and major subsectors.
The database is constructed using a methodology that is similar to the one used to construct the multifactor productivity estimates at the national level, released in The Daily on April 16, 2024.
Data in this release reflect data on fixed capital for 2022, published in The Daily on November 16, 2023, and data for 2022 on hours worked and labour productivity in the provinces, published in The Daily on February 9, 2024.
Multifactor productivity measures at Statistics Canada are derived from a growth accounting framework that allows analysts to isolate the effects of increases in input intensity and skill upgrading on growth in labour productivity. The residual portion of labour productivity growth that is not attributable to increases in input intensity and skill upgrading is called "growth in multifactor productivity." It measures the efficiency with which inputs are used in production. Growth in this area is often associated with technological change, organizational change or economies of scale.
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).
- Date modified: