By: Shanza Anwaar
The stagnant state of the Canadian economy in the past few decades could mean a decline in the standard of living for Canadians and a threat to entrepreneurship in Canada. In its annual report, auditing giant Deloitte discussed how Canada lags behind the US and other developed nations in growth. The report revealed the following statistics on the bleak future of the Canadian economy.
- The Canadian manufacturing sector saw a growth of 0.88% in 8 years compared to its neighbour US, which saw a growth rate of 3.3% in manufacturing.
- With the rise in labour costs between 2000 and 2007, “Canadian business’ per-worker investment in labour-saving machinery and processes was only 52% of the U.S. investment”.
- 5% of all firms that experience rapid growth provide 43% of new jobs.
- In Israel, 5.43% of firms five years or older continue to maintain high growth, with the US sustaining 4.5%. Canada lags behind at 2.66%
- Canada has a meager 10 Free Trade Agreements (FTAs) compared to Chile that has a whopping 52. With an overdependence on NAFTA, Canada has limited its potential for further growth.
If the Canadian economy continues to spiral downward, Canadians can expect to see a lowered standard of living producing a negative impact on income, healthcare, education and other factors that compose quality of life.
How can Canada overcome the Productivity Gap?
By Encouraging competition:
- More foreign direct investment should be promoted
- “Facilitate business and investor immigration to Canada”
- Reduce the reliance on NAFTA and sign more FTAs.
By Promoting Academia
- Create programs that mesh STEM fields with business and industrial needs.
- Invest in IPs cultivated at the post-secondary level
By taking more risks:
- Canadian businesses must compete outside the Canadian and American market: it’s bigger.
- Retain skilled employees
- Invest heavily in R&D
The dormant landscape of Canada’s economy can prove to be a challenge for entrepreneurs building their businesses. Yet this is exactly what entrepreneurs need to foster innovative ideas that not only stimulate their businesses but also fuel the productivity of the Canadian economy.
If you’re an innovator looking to stimulate and grow your business in Peel Region, you can join the newly founded Silicon Peel initiative. This is a grassroots community dedicated to connecting and creating strong local relationships for high tech entrepreneurs, leaders and businesses. Silicon Peel is meant to provide a forum for tech entrepreneurs and enterprises to attend networking events, showcase their companies, while boosting innovation and productivity in Peel Region. If you’re interested in becoming a part of this community, click here to join the LinkedIn Group and attend upcoming meet-ups.
Shanza joins the RIC team as a Social Media Intern. Pursuing two undergraduate majors in anthropology and professional writing at the University of Toronto Mississauga, Shanza is also a co-editor and content writer at the Digital Enterprise Management Society. She hopes to make her mark as a Social Media Consultant.
The RIC blog is designed as a showcase for entrepreneurs and innovation. Our guest bloggers provide a wealth of information based on their personal and professional experiences. Visit RIC Centre for more information on how RIC can accelerate your ideas to market.