Productivity Booster: Leveraging innovation, offering Canadian workers a path to prosperity on their terms

  • National Newswatch

It is no secret that the Canadian economy continues to grapple with stagnating productivity levels, recently leading the Bank of Canada to declare it as an emergency. In recent years, Canada’s productivity has decreased to just 71 percent of that of the United States, falling behind our G7 peers, including France, Australia and Britain. And while the pandemic caused a global decline in productivity, Canada has not recovered to pre-pandemic levels, signalling potential long-term impact for our national economy and international competitiveness.

Although traditional economic metrics highlight a concerning trend, an equally profound trend lies in how Canadians perceive and pursue personal paths to prosperity. Increasingly, Canadians are taking a holistic view of how they define ‘prosperity’. According to 2024 research conducted by Mastercard, 49 per cent of Canadians cited health and wellbeing as the top factor in impacting prosperity, followed by financial stability at 46 per cent. It is a powerful insight for Canada’s business and government leaders to consider as they ponder how to address the productivity gap we face today.

If Canadians’ understanding of prosperity is shifting, should the opportunities and experience of how Canadians work also shift to maximize employee fulfillment and, in turn, productivity?

When considering the future of work and prosperity in the context of decreased productivity, employers must shift to creating human-centric environments that consider the whole person and their individual circumstances, such as physical and mental health, family obligations, and diversity and inclusion.

Tackling the productivity problem in the Canadian economy requires strong collaboration between governments and businesses to form a societal environment that enables prosperity in all aspects of business and life. It’s a broader societal shift that encourages fulsome and holistic prosperity.

As we undergo these socio-economic shifts, it is also imperative to look at how technology and innovation—when used responsibly—can boost productivity and enhance Canada’s position among G7 peers, while also improving the well-being of our workforce. While mainstream adoption of new technologies such as AI caused initial public fear over jobs losses, privacy infringement, among others, AI tools have also been found to reduce redundant work tasks and streamline work processes, freeing up time to do more meaningful and productive work.

Although as part of the most recent budget, the federal government announced an investment of $2.4 billion into securing Canada’s AI advantage. In comparison to other leading global economies such as the United States and the United Kingdom, Canada’s rate of adoption of new technologies has been slower. Only 37 per cent of Canadian companies are reporting AI utilization, compared to over 60 per cent in the United States and 68 per cent in the United Kingdom within large corporations.

Could a faster development or roll-out of innovative technologies positively impact our country’s productivity levels and, thus, our economy?

The short answer is: yes. Even though Canada has long been viewed to have a stable economy, we are not well known for taking risks. Innovation requires some level of risk though and, as we move toward a digital economy, it must be prioritized.

Canadians think so too. According to our recent research study, 65 per cent of Canadians agree that advances in technology and innovation will make Canada more prosperous in the future and 55 per cent of Gen-Z respondents believe that technology offers them more opportunities to prosper.

Many private corporations in Canada are innovating and have readily available access to these technologies. Yet, continued investment in research and development paired with strong partnerships between the public and private sector are vital to ensure Canada is at the forefront of adopting new technologies. Through collaboration and knowledge exchange, partnership will drive economic inclusivity, ensure Canada prospers in the digital age and set up a strong foundation for Canada’s future economy.

Sasha Krstic is President of Mastercard in Canada.