The Canadian Productivity Review

Volume 2007
Number 7

Abstract

Introduction

Provincial productivity growth,
1997 to 2005

Provincial labour productivity
1997 and 2005

Conclusion

References

Figures

More information

PDF version

Other issues
in this series

About this
series

Conclusion

Productivity statistics garner much attention because they are key indicators of economic progress. This paper reports on the growth in provincial labour productivity from 1997 to 2005. It examines how differences in average productivity growth have influenced relative labour productivity in different provinces.

All provinces have grown their labour productivity in an absolute sense — with each producing more constant dollar gross domestic product per hour worked in 2005 than in 1997. This said, the relative productivity of most provinces that abstracts from price changes has remained fairly stable over this period when benchmarked against movements in the national average. The notable exception is Newfoundland and Labrador, which experienced much stronger average productivity growth during this nine-year period than other provinces. This growth substantially improved Newfoundland and Labrador's relative labour productivity, which, in 2005, was equivalent to the national average.

It is also apparent from our tabulations that productivity statistics that abstract from price changes provide only partial information on the relative performance of different provinces. In reality, the prices that prevail in one period are not those that prevail in the next. And how provinces fare relative to one another will depend not only on whether they have managed to grow their productivity in real terms, but also on whether the prices for their outputs have increased relative to those in other provinces. As this paper shows, the resource-rich provincial economies of Alberta and Newfoundland and Labrador have benefited substantially from these relative price changes.