It is far from clear that the latest federal budget will have a meaningful effect on boosting Canada’s productivity performance.

The budget barely touched areas that could affect long-term productivity growth – a very important omission. There needs to be greater recognition of the importance of productivity growth for our economic success.  Productivity is the output per hour per employee. That requires the strengthening of labour’s activities. By doing so Canada’s relative prospects will improve.

There are many components involved.  For example, broad tax reform, which encourages workers to become more efficient, and furthering the use of labour-saving equipment will enhance labour’s productivity.

Too, efficient updated transportation facilities should make labour more capable, along with solid infrastructure of highways, railways and waterways being kept in good order. After all, delays in bringing material to the market could be very costly.

Obstacles to productivity certainly include foreign ownership that has little interest in helping the operations of a subsidiary; not of primary importance when controlled by another company which wants the business itself. It might just detract from the success of the parent company.

More Canadian ownership and investment here needs to be encouraged. Instead of being primarily a commodity-based economy, we need to manufacture more of our raw materials here rather than through primarily export, resulting in more job security and greater productivity.

Labour unions must be brought alongside. In some cases, unions are reluctant to take steps that may mean workers’ displacement. If labour were more productive, that would mean their rewards would be easier to justify.

Unions are short-sighted in resisting change. Luddites in Britain long ago tried to sabotage machinery and other steps that would make labour more productive, little realizing that in the long run they were hurting themselves. Once labour became more productive, the demand for their services gained.

The working environment of a company is important. If the factory were an uncomfortable place to work, clearly that would inhibit productivity. Then too, employers, management and employees need to encourage the golden rule in the work place of treating each other with respect, a winning strategy.

Upon hiring, in-depth, in-house training is essential for workers so that important techniques can be learned at the outset, eliminating downtime. Proper training pays big dividends and should certainly lead to greater efficiency.

Governments must be committed to make productivity a key objective and pursue principles to that end, which will entail untold benefits to our economy.

 

 

Bruce Whitestone

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