The Bank of Canada recently warned of the seriousness of the decline in the country's productivity growth rates, considering it an "emergency situation" that may require raising interest rates and restricting wage increases for Canadian citizens.

In a speech delivered by the Deputy Governor of the Bank of Canada, Carolyn Rogers, in Halifax today, she pointed to the necessity of addressing the weakness in the country's productivity to ensure economic stability and protect it from future inflation risks.

Rogers confirmed that productivity rates in Canada have significantly declined, dropping from 88% of the productivity level in the United States in 1984 to approximately only 71% in 2022, according to data from Statistics Canada.

Rogers explained that Canadian productivity rates have seen a continuous decline over the past six years, despite some slight improvement at the end of 2023, noting that the investment gap between Canadian companies and their American counterparts has widened over the past decade, indicating a decline in investment in productive efficiency among Canadian companies compared to American ones.

Rogers concluded her talk by affirming that Canadian investment remains below American investment levels, and that Canada lags behind in this regard compared to other G7 countries, necessitating a new stimulus to support investment and raise productivity rates to enhance economic stability and achieve balanced growth.