Bank of Canada says affordability crisis linked to productivity

Income growth driven by productivity gains comes with little to no inflationary pressures. Photo by Getty Images

Canada’s affordability crisis is really a productivity problem , which can be rectified through rising incomes brought on by productivity gains, according to the Bank of Canada.

“If we want to make things affordable, we need to raise our income,” said Bank of Canada external deputy governor Nicolas Vincent, during remarks at the Association des économistes québécois and CFA Québec, in Quebec City on Wednesday. “And the way we grow our income is by increasing productivity.”

In his speech, Vincent highlighted the depth of Canada’s productivity difficulties, noting since 2000 Canada has lagged the United States and other G7 countries. Canada’s annual labour productivity gro