Going for Growth - Canada

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Canada GDP per capita has remained between 5% and 10% below the upper half of the OECD countries over the past twenty five years. Labour utilisation is above average, but GDP per capita is dragged down by poor labour productivity. Income inequality is around the OECD average and has changed little since 2000, with less-than-average redistribution through taxes and transfers. Greenhouse gas emissions are high per capita and per unit of GDP and have failed to decline over the past two decades. A number of measures have been taken to enhance access to post-secondary education and its responsiveness to skills demand. Progress has also been made to improve the innovation framework through the federal government’s Innovation and Skills Plan, increased funding for fundamental research and greater support for venture capital. The Canada Free Trade Agreement has reduced barriers to internal trade. Enhancing product market competition through reducing restrictions on foreign entry and barriers to internal trade is key to raising productivity. Tax reform would further promote productivity and green growth. Further work with provinces to improve labour market information and the number and quality of apprenticeships would boost students’ labour market outcomes and is of particular importance for disadvantaged groups. Improving labour market outcomes for women, notably by making childcare more accessible, would support inclusive growth. Growth performance, inequality and environment indicators: Canada C. The gap in labour productivity persists

A. Growth Average annual growth rates (%) GDP per capita Labour utilisation of which: Labour force participation rate Employment rate1 Employment coefficient2 Labour productivity of which: Capital deepening Total factor productivity Dependency ratio

2002-08 1.3 0.6 0.3 0.3 0.0 0.5 0.4 0.1 0.2

2012-18 0.9 0.2 -0.1 0.3 0.0 0.8 0.4 0.5 -0.1

Level

Annual variation (percentage points)

2016 30.7 (31.7)*

2013-16 -0.4 (0)*

B. Inequality and environment

Gini coefficient3 Share of national disposable income held by the poorest 20%

GHG emissions per capita4 (tonnes of CO2 equivalent) GHG emissions per unit of GDP4 (kg of CO2 equivalent per USD) Share in global GHG emissions4 (%) * OECD simple average (weighted average for emissions data)

7.6 (7.6)*

0.1 (0)*

2016 18.7 (10.9)* 0.4 (0.3)* 1.7

Average of levels 2010-16 19.3 (11.3)* 0.5 (0.3)* 1.6

Gap to the upper half of OECD countries5 Per cent 0

-5

-10

-15

GDP per capita

GDP per hour worked

-20

Source: Panel A: OECD, Economic Outlook Database; Panel B: OECD, Income Distribution and National Accounts Databases; United Nations Framework Convention on Climate Change (UNFCCC) Database and International Energy Agency (IEA), Energy Database; Panel C: OECD, National Accounts and Productivity Databases. StatLink 2 https://doi.org/10.1787/888933954705


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