Bank of Canada senior deputy governor Carolyn Rogers warned Tuesday that the country needs to ramp up its productivity as the health of its economy depends on high efficiency.
The official noted that strong productivity, which leads to faster growth, more jobs, and higher wages, is an important way to protect the domestic economy from the risks of high inflation.
According to Rogers, Canada's productivity has slipped significantly over the past four decades, and the country now has the second-worst productivity record among G7 countries. “You’ve seen those signs that say, ‘In emergency, break glass.’ Well, it’s time to break the glass,” she noted.
Increasing competition is among the solutions that Rogers offered to help improve Canada’s productivity. “Competition drives companies to become more productive by innovating and by finding ways to be more efficient,” she noted.
Also, the BoC's senior deputy governor proposed to focus on the labour composition, or the skills workers bring to the job, as well as investment levels, which, in her opinion, are nowhere near as high as they should be in the areas of machinery, equipment, and intellectual property.