VANCOUVER—Investment in productivity-enhancing assets such as factories, machinery, equipment, and intellectual property (e.g. computer software) in Canada remains below pre-2015 levels, finds a new study released by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.

“When businesses invest in new factories, new equipment and new machinery, workers become more productive, and when workers are more productive, their standards of living increase,” said Steven Globerman, senior fellow at the Fraser Institute and author of Recent Capital Investment Not a Signal that Canada’s Business Investment Emergency Is Over.

“Unfortunately for Canadians, business investment is still below 2015 levels, which means worker living standards have been stagnating for the past decade.”

The study finds that private business investment in factories, machinery, equipment, and intellectual property (including computer software)—all of which help make workers more productive—has declined as a share of the overall economy over the last decade.

In 2014, such investments were nearly 14 per cent of the economy, whereas in 2025, they were just 11.1 per cent.

Crucially, the rapid growth rate of Canada’s labour force from 2022 to 2025, combined with the sluggish rate of capital investment has resulted in a decrease in the amount of investment per worker, which will prolong Canada’s productivity crisis.

“Increasing the rate of business investment is critically important for improving worker productivity, which in turn raises living standards for Canadians,” Globerman said.

Fraser Institute——Bio and Archives

The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of 86 think-tanks. Its mission is to measure, study, and communicate the impact of competitive markets and government intervention on the welfare of individuals. To protect the Institute’s independence, it does not accept grants from governments or contracts for research. Visit fraserinstitute.org.

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