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 recently 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 Fraser Institute said 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, it noted.
“Increasing the rate of business investment is critically important for improving worker productivity, which in turn raises living standards for Canadians,” said Globerman.
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Entrepreneur. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 and 2024 as one of the top business journalists in the world by PR News. He was also named by RETHINK to its global list of Top Retail Experts 2024, 2025 and 2026.
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