Commentary
For decades, Canada’s productivity problem has been treated as an economic concern best left to economists, business leaders, and finance ministers. That is no longer the case. Today, Canada’s stagnant productivity has become a matter of national security, fiscal sustainability, and international influence.
The world has changed. Nations are no longer competing solely on the size of their economies, but on their capacity to innovate, manufacture, develop advanced technologies, and sustain modern armed forces. Economic strength has become strategic strength. Countries that generate wealth can invest in defence, infrastructure, research, and diplomacy. Countries that do not eventually find their choices constrained by debt, declining competitiveness, and diminished influence. Canada finds itself at a crossroads.
The evidence is becoming increasingly difficult to ignore. According to the OECD, Canada’s labour productivity grew by an average of just 0.5 percent annually between 2019 and 2023, well below the pace required to sustain rising living standards and trailing many of our closest competitors. At the same time, the OECD reports that business investment per Canadian worker has fallen to just 85 percent of its 2014 level, while investment per worker has risen 21 percent in the United States over the same period.
Investment drives innovation, innovation drives productivity, and productivity ultimately drives national prosperity. Canada is losing ground on all three fronts. These trends should concern every Canadian, regardless of political affiliation.
A productive economy is what pays for universal health care, modern infrastructure, scientific research, and a capable military. It is what allows governments to respond to crises without burdening future generations with unsustainable debt. Productivity is not an abstract economic indicator. It is the foundation upon which national prosperity and sovereignty are built.
The consequences are already becoming visible. The OECD estimates that Canada’s annual growth in GDP per capita has fallen from more than 2.5 percent in the late 1990s to nearly zero between 2019 and 2023. Had Canada maintained the stronger growth trajectory of previous decades, our national income per person would be dramatically higher today. That represents billions of dollars in lost economic activity, lower wages, reduced government revenues, and fewer resources available for the priorities Canadians value most. The implications extend well beyond economics.
Canada has committed to rebuilding its armed forces at a time when the global security environment is becoming increasingly dangerous. Russia continues its aggression against Ukraine. China is expanding its military capabilities and asserting its influence across the Indo-Pacific. The Arctic is becoming an arena of strategic competition. Meeting these challenges requires more than political will. It requires sustained economic capacity. Every additional dollar devoted to defence, Arctic infrastructure, or technological innovation must first be created by a productive economy.
The same principle applies to emerging technologies. Artificial intelligence, advanced manufacturing, quantum computing, cybersecurity, and critical minerals will shape the next generation of economic and geopolitical leadership. Canada possesses world-class universities, abundant natural resources, and an exceptionally skilled workforce. What has too often been lacking is the policy environment needed to transform these advantages into sustained investment and commercial success.
We should not underestimate Canada’s strengths. We remain one of the world’s most stable democracies. We possess immense reserves of energy, critical minerals, fresh water, and agricultural land. Our financial institutions are respected globally. Our entrepreneurs continue to build innovative companies despite significant obstacles. The challenge is not one of potential. It is one of execution.
Reversing Canada’s productivity decline will require governments of every political stripe to focus relentlessly on growth. That means encouraging private investment, reducing unnecessary regulatory delays, accelerating major infrastructure projects, strengthening internal free trade, modernizing our tax system, and expanding access to global markets. It also means investing in skills, research, and technologies that increase the productivity of Canadian workers rather than simply expanding the size of the labour force.
Equally important, governments must restore confidence that Canada is once again a country where ambitious projects can be proposed, approved, and built within reasonable time frames. Investors seek stability, predictability, and the confidence that success will be rewarded rather than discouraged.
Canadians have never lacked talent or determination. Throughout our history, we have repeatedly demonstrated an ability to adapt, innovate, and compete when circumstances demanded it. From building a transcontinental railway to developing a world-class aerospace industry, our greatest achievements have come when we embraced growth with confidence rather than caution. The coming decade will determine whether Canada remains among the world’s leading advanced economies or gradually falls behind more dynamic competitors. The choices we make today will shape not only our prosperity but also our ability to defend our sovereignty, protect our values, and provide opportunity for future generations.
Productivity is no longer merely an economic statistic. It has become the measure of a nation’s strength. The countries that will lead the 21st century will not necessarily be those with the largest populations or the richest natural resources. They will be those that create the conditions for investment, innovation, and sustained economic growth. Canada has every advantage required to succeed, but advantages alone are not enough. They must be matched by sound policy, disciplined execution, and the confidence to build.
If Canada is serious about securing its future, restoring productivity must become a national priority.
Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.
