Labour productivity: Services-Producing Industries (NAICS 41-91)

Under this topic you will find an index of labour productivity for Canada's Services-Producing Industries (NAICS 41-91) sector grouping which can be used to identify trends in labour-productivity within the subsector and to gain insight into factors that affect it, such as innovation, efficiency and labour market flexibility.

Labour productivity index

The graph below illustrates changes in labour productivity for the Services-Producing Industries sector grouping in comparison to the Canadian Economy between 2008 and 2012.

Labour Productivity Index: 2008-2012
Services-Producing Industries (NAICS 41-91)
  2008 2009 2010 2011 2012
NAICS (Labour Productivity Index) 100.829 98.761 100.97 103.363 105.277
Canadian Economy (Labour Productivity Index) 101.095 98.264 101.376 103.977 105.887

Source: Statistics Canada, CANSIM table 383-0012, 2008 to 2012.

Between 2008 and 2012, labour productivity for the Services-Producing Industries sector grouping increased 1.1% per year on average. In comparison, labour productivity for the Canadian Economy increased 1.2% per year.

Over the most recent year, labour productivity in the Services-Producing Industries sector grouping increased 1.9%, compared to an increase of 1.8% for the Canadian Economy.

Productivity growth may occur for a number of reasons. For example, labour productivity may rise if output increases while employment levels decrease or stay on par. This phenomenon may occur from firms becoming more capital intensive, that is, increasing their use of technology and capital inputs in order to become more productive.

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Notes on labour productivity data

At the Canadian Economy level, the labour productivity index refers to all economic activities that were carried out in the country.In other words, it covers both the business sector and the non-commercial sector.

Below the level of the Canadian Economy, only the activities of the business sector are factored into the calculation of the indices.

Labour Productivity data is only available at the NAICS sector (2-digit) level. As a result, businesses should use caution when using the data to make inferences about more specific industry segments.

Labour productivity measures the extent to which labour is efficiently used. An increase in labour productivity is associated with increases to real incomes and the standard of living for an economy. It is determined by its capital intensity (or changes in the amount of capital per hour worked), investment in human capital, and multi-factor productivity which includes technological change, organizational innovation, and economies of scale.

Annual measures of labour productivity are helpful in identifying sources of economic growth, indicate how efficiently labour is used in production, and compute unit labour costs. However, these measurements must be interpreted carefully, as labour productivity estimates reflect change in other factors of production (such as capital) in addition to growth in productivity efficiency.

Labour productivity defines its hours worked, as the total number of hours a person spends working, whether paid or not. Time lost to strikes, lockouts, sick leave, etc., is not included but travel time, time training, and overtime hours are comprised in the total.

The annual indices on productivity presented in Canadian Industry Statistics are derived using values from CANSIM Table 383-0012.