Issue 20-85: Multifactor Productivity

May 19, 2020

Multifactor productivity is a measure of how efficiently inputs are used in the production process. Increases in productivity are typically associated with economies of scale, organizational structures improvements and technological advancements.

British Columbia’s multifactor productivity increased 0.2% in 2018 compared to the previous year, one of three provinces to see an improvement in that period. British Columbia had the highest productivity growth rate among provinces between 2010 and 2017, growing an average of 1.5% per year compared to 0.7% for Canada as a whole.

Nationally, business multifactor productivity was virtually unchanged between 2017 and 2018. Productivity increases in Quebec (+1.0%), Alberta (+0.3%) and British Columbia (+0.2%) offset productivity declines in the rest of the provinces. The largest drop in business productivity was in Newfoundland and Labrador (-5.7%).

On an industrial level, mining and oil and gas extraction (+5.1%) and manufacturing (+1.2%) saw the largest increases in productivity in 2018. On the other hand, transportation and warehousing (-2.3%) and construction (-1.3%) had the largest productivity reductions.

Data Source: Statistics Canada