Levels, but Average Productivity Growth

The report, based on the CSLS Provincial Productivity Database, provides an overview of Ontario’s productivity performance over the 1997-2007 period. The key findings are the following: • Ontario’s labour productivity growth in the market sector was the same as the national average during the 1997-2007 period, 1.7 per cent per year. This is not surprising given the size of Ontario’s economy relative to Canada’s. More specifically, Ontario accounted for 37.8 per cent of Canada’s nominal GDP, and 40.0 per cent of total hours worked in Canada in 2007. Ontario’s performance ranked 7th among the provinces in terms of labour productivity growth. • In contrast to Canada, where labour productivity growth was driven mainly by increases in capital intensity, in Ontario the main driver was multifactor productivity growth, which was responsible for 48.1 per cent of total growth. Capital intensity growth accounted for 32.3 per cent of labour productivity growth, while labour quality accounted for 18.8 per cent. • Ontario’s labour productivity level in 2007 was $37.32 (1997 dollars) per hour, which represents 103.5 per cent of the Canadian level. This, in turn, implies a positive labour productivity differential of 3.5 percentage points. This positive differential was caused by a high multifactor productivity level, which was able to offset the low capital intensity level in Ontario’s marke