Bank of Canada governor Tiff Macklem is sounding the alarm on Canada's productivity problem and urging policymakers to dig into why the country struggles with low business investment.Bank of Canada governor Tiff Macklem speaks to reporters during a news conference following the bank's key interest rate announcement in Ottawa on Wednesday, June 5, 2024.
But looking at the longer-term economic picture, he warned productivity is the country's weakness, noting that on average, businesses invest much less per worker in Canada than they do in the United States. The issue of productivity is top-of-mind for many economists concerned that low business investment will depress living standards in the country.Macklem said figuring out how to make Canada a better place to invest is critical to supporting non-inflationary economic growth and higher living standards.
"But our message is if you want more non-inflationary growth, we're going to need a concerted discussion between businesses, governments, and academics, civil society, on how are we going to get productivity growth up in Canada," he said.