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Released:2024-06-05
Quarterly labour productivity
First quarter2024
-0.3%
(quarterly change)
Source(s): Table 36-10-0206-01.
Labour productivity declines following a quarter of growth
Labour productivity of Canadian businesses declined0.3% in the first quarter, following an increase of0.2% in the previous quarter.
Chart1
Business output increases at a slower pace than hours worked
In the first quarter, business output grew moderately, as in the previous quarter. At the same time, hours worked rebounded, recording a growth that outpaced that of output.
Real gross domestic product of businesses edged up0.1% in the first quarter, similar to the increase recorded in the fourth quarter of2023.
Hours worked return to increase after two quarters of little change
Hours worked in the business sector increased0.4% in the first quarter of2024, after posting slight variations in each of the previous two quarters.
The increase in hours worked in the first quarter reflects the0.4% growth in the number of jobs, while average hours worked were unchanged.
In the first quarter, hours worked in services-producing businesses recorded an increase of0.6%, following stability in the previous quarter. In contrast, after edging down in the previous two quarters, hours worked in goods-producing businesses were unchanged for a second time in a year.
Overall, hours worked were up in9of the16industry sectors in the first quarter and were relatively stable in4: mining and oil and gas extraction, construction, retail trade, and transportation and warehousing.
Productivity is down in half of the industry sectors
In total, productivity fell in half of the16industry sectors in the first quarter, while it was essentially unchanged in construction, real estate services, and other business services.
Manufacturing and, to a lesser extent, professional services as well as administrative services were the main contributors to the overall decline in productivity in the first quarter. Declines observed in these three sectors were mostly offset by strong gains in productivity in the agriculture and forestry sector and, to a lesser extent, accommodation and food services as well as transportation and warehousing services.
Unit labour costs rise at a faster pace in the first quarter
In the first quarter, productivity fell0.3%, whereas hourly compensation (+1.0%) increased at a much faster pace than in the previous quarter (+0.4%). As a result, unit labour costs of businesses were up1.3%. This was much higher than the growth observed in the previous quarter (+0.2%).
Unit labour costs represent the costs of wages and benefits a business pays its workers to produce one unit of output.
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Table1Business sector: Labour productivity and related variables for Canada and the United States – Seasonally adjusted
Table2Labour productivity and related measures, by business sector industry, seasonally adjusted, first quarter2024
Sustainable Development Goals
On January1,2016, the world officially began implementing the 2030Agenda for Sustainable Development—the United Nations' transformative plan of action that addresses urgent global challenges over the following15years. The plan is based on17specific Sustainable Development Goals (SDGs).
The release "Labour productivity, hourly compensation and unit labour cost" is an example of how Statistics Canada supports the reporting on the global SDGs. This release will be used to help measure the following goal:
Note to readers
Revisions
With this release, data were revised back to the first quarter of2023at the aggregate and industry levels. These revisions are consistent with those incorporated in the release on quarterly gross domestic product (GDP) by income and expenditure and the release on monthly GDP by industry, released on May31,2024.
This release also incorporates the new2023benchmark data on provincial and territorial labour productivity and related measures, published on May21,2024.
In addition, changes were introduced in the fourth quarter of2023to the methodology for estimating post-1997data in the non-commercial sector. More specifically, this methodology was aimed at reducing modelling and ensuring better control at the microdata level for the government sector, which is part of the non-business sector. For the first quarter of2024, additional adjustments have been applied to pre-1997years to ensure continued comparability of data over time. Without prior adjustment, these changes could have led to breaks in the data trends. These changes only affect the breakdown of the total economy between the non-business and business sectors, but not the total economy itself.
Productivity measures
The term productivity in this release refers to labour productivity. For the purposes of this analysis, labour productivity and related variables cover the business sector only.
Labour productivity is a measure of real GDP per hour worked.
Unit labour cost is defined as the cost of workers' wages and benefits per unit of real GDP.
The approach to measuring real output in the business sector differs from the one that is used in the estimates by industry. For the business sector, output is measured using the expenditure-based GDP approach at market prices. This approach is similar to that used for the quarterly measures of productivity in the United States. However, output by industry is based on the value added at basic prices.
All the growth rates reported in this release are rounded to one decimal place. They are calculated with index numbers rounded to three decimal places, which are now available in data tables.
All necessary basic variables for productivity analyses (such as hours worked, employment, output and compensation) are seasonally adjusted. For information on seasonal adjustment, see Seasonally adjusted data – Frequently asked questions.
Next release
Labour productivity, hourly compensation and unit labour cost data for the second quarter will be released on September5.
Products
The document "Labour productivity measurement at Statistics Canada," which is part of Latest Developments in the Canadian Economic Accounts (Catalogue number13-605-X), is now available.
The study, "Canadian regional labour statistics and inter-regional movements of paid workers,2001to2021," which is part of Latest Developments in the Canadian Economic Accounts (Catalogue number13-605-X), is available.
The Economic accounts statistics portal, accessible from the Subjects module of the Statistics Canada website, features an up-to-date portrait of national and provincial economies and their structures.
The Latest Developments in the Canadian Economic Accounts (Catalogue number13-605-X) is available.
The User Guide: Canadian System of Macroeconomic Accounts (Catalogue number13-606-G) is available.
The Methodological Guide: Canadian System of Macroeconomic Accounts (Catalogue number13-607-X) is available.
Contact information
For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; infostats@statcan.gc.ca) or Media Relations (statcan.mediahotline-ligneinfomedias.statcan@statcan.gc.ca).
