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Can Sectoral Reallocations of Labour Explain Canada’s Absymal Productivity Performance?

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  • Andrew Sharpe

Abstract

This report presents a framework for decomposing aggregate productivity growth into within-sector effects and sectoral reallocation effects. This framework is used to analyze productivity growth in 12 Canadian industries for the 1961-2007 period and for several subperiods. The results do not support the common view that Canada’s weak post-2000 productivity performance is attributable to a reallocation of labour toward mining, oil and gas, a sector with low productivity growth. Rather, it was the fall in labour productivity growth in manufacturing that accounted for all of the slowdown in business sector productivity growth after 2000.

Suggested Citation

  • Andrew Sharpe, 2010. "Can Sectoral Reallocations of Labour Explain Canada’s Absymal Productivity Performance?," International Productivity Monitor, Centre for the Study of Living Standards, vol. 19, pages 40-49, Spring.
    • Handle: RePEc:sls:ipmsls:v:19:y:2010:3
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    File URL: http://www.csls.ca/ipm/19/IPM-19-sharpe.pdf
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    References listed on IDEAS

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    1. Jianmin Tang & Weimin Wang, 2004. "Sources of aggregate labour productivity growth in Canada and the United States," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 37(2), pages 421-444, May.
    2. Andrew Sharpe, 2010. "The Paradox of Market-Oriented Public Policy and Poor Productivity Growth in Canada," CSLS Research Reports 2010-01, Centre for the Study of Living Standards.
    3. Jean-Francois Arsenault & Andrew Sharpe, 2008. "An Analysis of the Causes of Weak Labour Productivity Growth in Canada since 2000," International Productivity Monitor, Centre for the Study of Living Standards, vol. 16, pages 14-39, Spring.
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    1. repec:zbw:bofitp:2017_018 is not listed on IDEAS
    2. Ilya B. Voskoboynikov, 2020. "Structural Change, Expanding Informality and Labor Productivity Growth in Russia," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 66(2), pages 394-417, June.
    3. John R. Baldwin & Michael Willox, 2016. "The Industry Origins of Canada's Weaker Labour Productivity Performance and the Role of Structural Adjustment in the Post-2000 Period," International Productivity Monitor, Centre for the Study of Living Standards, vol. 31, pages 19-36, Fall.
    4. Don Drummond & Evan Capeluck & Matthew Calver, 2015. "The Key Challenge for Canadian Public Policy: Generating Inclusive and Sustainable Economic Growth," CSLS Research Reports 2015-11, Centre for the Study of Living Standards.
    5. Wulong Gu & Michael Willox, 2018. "Productivity Growth in Canada and the United States: Recent Industry Trends and Potential Explanations," International Productivity Monitor, Centre for the Study of Living Standards, vol. 35, pages 73-94, Fall.
    6. V. Blyznyuk & Y. Yuryk, 2018. "Asymmetricity in the development of the industrial segment of Ukrainian labor market," Economy and Forecasting, Valeriy Heyets, issue 4, pages 65-80.
    7. Roberta Montebello & Jude Darmanin, 2021. "Saving behaviour in Malta: Insights from the Household Budgetary Survey," CBM Working Papers WP/04/2021, Central Bank of Malta.
    8. Oliver Loertscher & Pau S. Pujolas, 2024. "Canadian productivity growth: Stuck in the oil sands," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 57(2), pages 478-501, May.
    9. Alexander Murray, 2017. "What Explains the Post-2004 U.S.Productivity Slowdown?," CSLS Research Reports 2017-05, Centre for the Study of Living Standards.
    10. Ilya B. Voskoboynikov, 2020. "Structural Change, Expanding Informality and Labor Productivity Growth in Russia," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 66(2), pages 394-417, June.

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    More about this item

    Keywords

    productivity growth; sectoral reallocation; labour productivity growth; industry; Canada;
    All these keywords.

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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