This report provides a detailed analysis of the productivity performance of the manufacturing sector in New Brunswick. Part one of the report provides a detailed overview of the manufacturing productivity in New Brunswick from 1997 to 2019. This part identifies a major turning point in the province's manufacturing productivity performance in 2004, after which output per hour of manufacturing plummetted from 109 percent of the national average to 75 per cent of the national average. Part two of the report attempts to shed light on this important development from different angles, namely, a growth accounting perspective, an industry perspective, a labour perspective along with a fourth section which examines additional explanations.
This paper examines whether economic analysis can help provide firmer foundations for the adjudication of human rights claims in establishing monetary awards for injury to dignity and, in accommodation cases, better capturing benefits for society. In relation to injury to dignity, it explores the prospects for establishing an objective evidentiary baseline through a program of independent economic research. In the area of accommodation, the paper considers if the wider use of Cost-Benefit Analysis could help prevent undervaluation of accommodation and whether governments should help cover the incremental cost of accommodation in some cases.
The explosive growth in Chinese imports to Canada over the last two decades has had both negative and positive effects. In this paper, we look at the impact of Chinese imports on the prices Canadians pay for household consumption goods. We find Canadians have benefited from lower prices on some goods and lower inflation overall. To quantify the importance of Chinese imports for individual consumer products and map them to consumer price data, we construct concordance between products in the consumer price index (CPI) and commodities in the Harmonized Commodity Description and Coding System. We estimate that over the 2001-2011 period, cumulative inflation would have been 1.17-percentage-points higher for the total CPI had there been no change in the Chinese share of total imports in Canada. This assumes other factors are held constant. The average annual inflation for the total CPI was 2.1 per cent over the 2001-2011 period, implying that annual inflation would have been about 0.12-percentage-points higher if there had not been a surge in imports from China.
The distribution of the gains of economic growth among workers and corporations has evolved over time. While an extensive body of literature has studied the fall in the share of labour income in the gross domestic product (GDP), less attention has been paid to the development of the components of its counterpart, the capital share. In the system of National Accounts, the capital share of income can be broken down into net operating surplus and net mixed income (which includes corporate profits before taxes, net interest paid, net other payments and inventory valuation adjustment, and net mixed income) and capital consumption allowances (CCA). This report contributes to the discussion on the rising capital share by studying the evolution of the Canadian corporate profit share in the past three decades using both financial and national accounts data. We analyze trends at the aggregate and sectoral level and compare the aggregate trends to those in the United States during the same period. We also provide an overview of the structural factors affecting the corporate profit share in Canada. According to national accounts data, the corporate profit share before tax in Canada rose 3.8 percentage points between the 1961-1999 and 2000-2017 periods, an increment that significantly enhanced the surge in the capital share of income. Similarly, the financial corporate profit share of income increased by 7.2 percentage points between 1997 and 2017. This development was widespread, with the profit share increasing in all sectors except mining, quarrying and oil, and gas extraction. It was also concentrated. We find that the financial sector, which accounts for less than one tenth of GDP, was responsible for 33 per cent of the increase in the corporate profit share. Complete time series of the profits data used in this report can be found in a profits database developed as part of this research project.
This literature review of government-funded refugee services identifies the issues related to refugee resettlement programs; settlement location; housing; mental health services and employment services in different Canadian provinces and cities. It then summarizes the best practices related to refugees’ integration in Canada or in other refugee resettlement countries. Wherever possible, the report mentions relevant policy recommendations addressed to Immigration, Refugees and Citizenship Canada (IRCC) in the different journal articles, papers or reports.
This report presents estimates of the Index of Economic Well-being (IEWB) and its four domains (consumption flows, stocks of wealth, economic equality and economic security) for Newfoundland and Labrador from 1981 to 2018. We find that the IEWB for Newfoundland and Labrador increased at an average annual rate of 1.75 per cent per year over the period. All four domains grew between 1981 and 2018, with the strongest growth in consumption and wealth. However, at the end of the period between 2014 and 2018, the IEWB along with the four domains deteriorated. Nevertheless, Newfoundland and Labrador enjoyed significant improvement between 1981 and 2018, especially compared to the other provinces. Newfoundland and Labrador achieved the fourth highest IEWB level of the ten provinces in 2018 and, most impressively, the highest growth between 1981 and 2018.
This report looks at Canada’s social safety net before the onset of the crisis caused by COVID-19 and collapsing oil prices. It sets the stage by reviewing trends in poverty and inequality between 1976 and 2018. The report examines the federal government’s Poverty Reduction Strategy and its success in reducing poverty for children and seniors. Working-age adults without children have experienced the smallest relative decrease in poverty and currently have the highest poverty rates among any age group. The report analyzes general eligibility criteria and work and training requirements for social assistance, and the adequacy of welfare. National trends show that welfare dependency has fallen significantly between 1998 and 2018. Other significant trends show an increase in the percentage of social assistance recipients reporting a disability, a growing proportion of single adults on welfare and a decrease in the number of families with children receiving social assistance. To reduce poverty and improve welfare adequacy, this report recommends increasing social assistance benefits, raising the minimum wage, improving earning supplements for low-wage workers and extending in-kind benefits to all low-income.
This report provides a descriptive analysis of the labour market outcomes of new immigrants to Canada from 2006 to 2019. Using data from the Labour Force Survey, it focuses on four labour market indicators: participation, unemployment, and employment rates, as well as average hourly wages. It compares trends in labour market outcomes among very recent immigrants (5 years or less since immigration), recent immigrants (5-10 years since immigration), and Canadian-born workers. This report finds that new immigrants are on average younger and better educated than the Canadian-born. As a result, their labour force participation and employment rates were comparable to, if not better than, those of the Canadian-born. However, the unemployment rates of new immigrants were higher, and average hourly wages were lower. Over the 2006 to 2019 period, very recent immigrants enjoyed an absolute and relative improvement in all four indicators. Recent immigrants enjoyed an improvement in all four absolute indicators and three of four relative indicators; relative hourly wages were the exception.
It is commonly noted that Americans are on average richer than Canadians. For example, in 2016, GDP per capita was US $47,294 in Canada (PPP-adjusted) compared to US $57,798 in the United States. However, this comparison of average incomes does not necessarily imply that all or even most Canadians are worse off than Americans. This report shows that Canadian households in the bottom 56 per cent of the income distribution are in fact better off than American households at the same point of the income distribution. This finding is driven by the lower income inequality in Canada, and illustrates how the usual comparison of incomes between Canada and the United States using GDP per capita or average household income hides a critical part of the story.
The main goal of this report is to describe and explain the trends in productivity in Newfoundland and Labrador, as well as trends in the variables used in the calculation of productivity, including output, labour input, and capital input. The main take-away from the report is the importance of the oil and gas sector to the economy of Newfoundland and Labrador. That sector has been responsible for most of Newfoundland and Labrador's economic growth, and now accounts for the largest share of the province’s business sector value added among 2-digit NAICS subsectors, even though it employed only 3.8 per cent of the province’s business sector workers in 2018. Due to the size of the mining and oil and gas extraction sector, its productivity performance strongly affects the performance of the overall business sector, which continues to represent a major challenge for the province. However, looking at the business sector excluding mining and oil and gas, productivity growth does fare better. The data can be split in two periods. Driven by the mining and oil and gas extraction sector, Newfoundland and Labrador’s overall productivity experienced impressive growth from 1997 to 2007, with real business sector productivity advancing at a compound annual rate of 6.0 per cent. The situation changed dramatically after 2007 when oil and gas productivity plummeted. Real business sector productivity in the province declined during the 2007-2018 period at a rate of 1.2 per cent per year
Business investment in research and development (R&D) makes a key contribution to rising living standards. Firms undertaking the R&D can reduce production costs and introduce new products that provide benefits to consumers that are not fully captured in selling prices. Further, it is very difficult for R&D-performing firms to prevent some of the knowledge created from leaking out or spilling over to other firms. Since firms do not take these positive spillover benefits into consideration when making investment decisions, most governments subsidize business investment in R&D with the expectation that economic performance will improve as a result. Our study confirms the existence of substantial spillover benefits from R&D performed in Canada, so government support for R&D is justified. However, we do not find any empirical evidence to support the current policy of subsidizing R&D at a higher rate when it is performed by small firms than when it is performed by large firms. We also find much lower private rate of return on R&D performed by small firms than by large firms. Subsidies appear to be playing a key role in this result
The Business Council of British Columbia (BCBC) is committed to developing a “B.C. Prosperity Index” for release in 2019. The twin objectives of the index are to track the province’s performance on various socio- economic indicators, both individually and in the aggregate, related to prosperity, defined in terms of living standards and economic well-being, over time and to compare the level and growth rates of these indicators with other sub-national and national jurisdictions. The purpose of this report is to present the estimates of the Prosperity Index for British Columbia with comparisons with three types of other jurisdictions (i.e. peer countries, Canadian provinces and Pacific U.S. states).
In March 2018 a report entitled “An Infrastructure Index for Remote Indigenous Communities” was delivered to INAC. The report included discussion of the rationale and methodology for the index and estimates for the index for 236 remote communities (200 Indigenous and 36 nonIndigenous) with breakdowns by jurisdiction (province/territory) and heritage group. The Index itself consisted of seven components of infrastructure (broadband, transportation, energy, health, education, water and housing) and 15 separate indicators. A database of over 3,450 data points was constructed with publically available information. One weakness identified with the index was the broadband indicator, which focused on the availability of broadband, not its quality in remote Indigenous communities. INAC (now CIRNAC) was interested in addressing this weakness and commissioned the Centre for the Study of Living Standards (CSLS) to develop a new broadband indicator. In this report, we develop a new index for broadband connectivity, incorporating two key factors that determine the quality of broadband services in Indigenous communities in remote regions: speed and capacity.
The objective of this report is to contribute to the debate on closing socio-economic gaps between Aboriginal and non-Aboriginal people by projecting the contribution of Aboriginal people to future labour force growth in Canada as a whole and by region under various scenarios over the 2011-2036 period.
In this paper, we provide a quantitative assessment of the impact on Canadian employment of a recent shock to Canada’s import supply: the rapid rise of China as a manufacturing export superpower in the late 1990s and early 2000s
This report presents augmented estimates of the Index of Economic Well-being (IEWB) for 14 OECD countries for the 1980-2013 period
Taking a gap year between high school and post-secondary education appears to be an increasingly popular phenomenon in popular culture, among well-known individuals and for Canadian youth. This report reviews the literature on issues related to gap years, with a focus on the Canadian context and the experiences of youth in several similar countries. Overall, taking a gap year appears to be a beneficial choice for many Canadian youth, although the impacts of a gap year are often dependent on the youth’s socioeconomic background and the activities they participate in during their gap year. Based on these findings in the literature, a number of options for public policy are proposed to improve knowledge of gap years, increase the take-up of gap years, and make gap years a more accessible option for disadvantaged segments of the population.
This report contributes to the debate on the role of Aboriginal people in the Canadian long-term economic growth by projecting the contribution of Metis people to future labour force growth in Canada as a whole and across regions under various projection scenarios. Based on our projections for the Metis labour force over the period 2011-2036, we find that the contribution of Metis to the total Canadian labour force is significant given their 1.2 per cent share in the total working age population in Canada. In our baseline scenario, the Metis people is projected to account for 6.4 per cent of total labour force growth. The Metis contribution is especially large in the regions with which the Metis has historical ties: namely the Prairie provinces and the Northern region. The contribution in these jurisdictions ranges from 11.8 per cent to 17.0 per cent. We find that the role of ethnic mobility is especially important for the Metis population growth. If we assume no ethnic mobility, the Metis contribution is projected to be 1.9 per cent of the total labour force growth in Canada. Nevertheless, this is still greater than the Metis share in the Canadian working age population in 2011.
Economic theory and history show that labour productivity growth is the main driver of rising living standards, so changes in the trend rate of productivity growth have profound implications for a society's future prosperity. The average annual rate of business sector labour productivity growth in the United States declined by 1.9 percentage points between the 1995-2004 period and the 2004-2015 period, from 3.2 per cent to 1.3 per cent. This article summarizes the state of knowledge on the causes of the post-2004 slowdown in U.S. productivity growth. Official growth accounting estimates indicate that 60-65 per cent of the labour productivity decline is accounted for by a decline in total factor productivity growth, while 30-35 per cent is accounted for by a decline in the rate of capital deepening. Three industries account for over 80 per cent of the aggregate labour productivity decline: manufacturing, wholesale trade, and retail trade. The aggregate productivity slowdown is traceable to a decline in the productivity contributions arising from industries that produce or intensively use information and communication technology (ICT) products.
