Abstract
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This paper provides a provincial perspective on the slowdown in productivity and economic growth in the total business sector in Canada between 2000 and 2010 compared to the late 1990s. It uses the most recent provincial multifactor productivity database.
The paper finds that the slowdown in aggregate output and productivity growth between 2000 and 2010 can be traced to what took place in two industries during this period: manufacturing in central Canada; and mining and oil and gas extraction in Alberta.
Aggregate output and productivity growth slowed in almost all provinces between 2000 and 2010. In general, the slowdown in aggregate output and labour productivity growth was larger in central Canada and the Atlantic Provinces than in western Canada during this period. The slowdown in output and productivity growth was largest in Ontario. From 1997 to 2000, Ontario was the main source of growth in aggregate output and productivity in Canada. Between 2000 and 2010, aggregate output and productivity growth in Ontario was among the slowest of the ten provinces.
The goods-producing sector was largely responsible for the slowdown in aggregate output and productivity growth between 2000 and 2010 in almost all provinces. The exact industries within the goods-producing sector that were mostly responsible differ across provinces. For central Canada, the manufacturing sector was the most important contributor to the slowdown in aggregate output and productivity growth. For Alberta, the natural resources industry and natural-resource-related construction accounted for most of the slowdown in aggregate productivity growth.
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