Investment in capital - rather than gains in worker skills or technological change - has been the key driver for labour productivity growth over the past 45 years, Statistics Canada has found.
Labour productivity, an important indicator of an economy's health, rose at an annual rate of 2.1 per cent between 1961 and 2005. Yesterday's study looked at the contribution of three main components of this growth.
It found that increases in capital intensity -- which measures the amount of capital in a business in relation to other production factors, especially labour -- contributed about 55 per cent of growth in labour productivity. In 2005 alone, capital intensity accounted for about three-quarters of the growth.
In terms of capital, "there has been a long-term shift towards machinery and equipment, and away from structure capital, land and inventories in the business sector," the report said. Within that category, information and communications technologies have increased the most.
Capital-intensive industries include the natural resources sector, along with the finance, insurance and real estate industries.
Gains associated with technological change accounted for about a quarter of the productivity growth in this period. The remainder - about 20 per cent - came from changes in the work force as more people obtained postsecondary degrees.
Since 2000, growth in labour productivity has slowed from the gains recorded between 1989 and 2000, especially in the mining and manufacturing sectors. This slowdown largely reflects a decline in growth of "multifactor" or technological productivity.
Labour productivity is a measure of the real gross domestic product per hour worked and, over time, it raises the population's standard of living and business competitiveness. Any gains are connected with changes in real wages over the long term.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment