TORONTO, June 4, 2024
/CNW/ - Canada is stuck in an economic rut. Our economy, when
adjusted for inflation and immigration, is smaller than it was
before the pandemic -- and pretty much in the same place it was a
decade ago.
Against this backdrop, RBC is launching The Growth
Project, a multi-part initiative focused on Canada's economic growth trajectory. The
initiative will offer key insights into productivity, AI, the
agriculture sector, immigration, trade, and skills development, and
will propose actionable strategies that can help solve Canada's growth problems.
"Canadians are telling us that economic uncertainty -- low
growth yet higher prices -- is their top concern. Addressing these
issues has become a key focus for RBC. We're convening stakeholders
across the country -- exploring ideas and solutions that can put
our economy on a better growth track. We're also making strategic
investments to help Canada's
workforce meet current and future labour market needs," said
John Stackhouse, SVP, Office of the
CEO.
And today, RBC Economics & Thought Leadership launched the
inaugural Growth Project research report titled Canada's Growth Challenge: Why the economy is
stuck in neutral. The report explores the conditions that have
led to Canadians working more, but producing less and explains why
our collective productivity is our country's most pressing economic
challenge.
"When we look at the Canadian economy since the turn of the
century, it's clear that our growth has stagnated. On average we've
seen productivity growth of less than 1% per year. The problem is
even more acute when we compare Canada's growth against that of the United States where our per-capita GDP
runs 30% below U.S. levels," said Nathan
Janzen, assistant chief economist, RBC Economics &
Thought Leadership.
"It's a multitude of issues contributing to the problem -- from
a lack of business investment to cumbersome tax regulation. What
our research shows is that the solutions are not easy to implement
but are clear and attainable."
Canada's Growth Challenge
identifies five growth-positive policies that would benefit
business owners and workers alike:
- Cutting red tape and reducing internal trade barriers:
Increase the speed and predictability of project approval times and
lower potential holding costs for businesses planning new
investments in Canada.
- Better utilization of immigrant skills: Recognizing
the credentials of foreign-trained professionals in fields like
healthcare to increase the productivity and earnings of those
workers and help address the chronic undersupply of those workers
in the labour market.
- Improving tax competitiveness: Policymakers should
aim to make sure tax rules can be easily understood to encourage
compliance, especially among those that are most in need of the
benefits, i.e., new businesses and lower-income households.
- Adopting new technologies: "Smarter" investments
like artificial intelligence can help but adoption rates are low in
Canada. Making it easier to invest
in new technologies is critical to maintaining global
competitiveness, improving the efficiency and predictability
of Canada's complicated project
approvals system and simplifying the tax system would benefit these
investments.
- Capitalizing on a highly educated
workforce: Increasing the utilization of work-integrated
learning placements (co-ops and internships) would help to better
match the developments of skills in the economy with current and
future labour market needs.
And while policy solutions can be powerful tools to enhance
growth, equally important is the need for Canada to embrace a growth mindset.
Canada's Growth
Challenge argues that if Canadians developed a collective
focus on the economy of the future -- one that rewards innovation,
celebrates competitiveness, invests in both people and technology,
and efficiently delivers returns -- the productivity puzzle may
become easier to solve. And with it, growth will return.
Preparing Canadians for the workforce of tomorrow
In addition to driving key insights about Canada's growth and productivity challenges,
RBC is helping Canadians develop the skills they need to excel in
tomorrow's workforce. Reinforcing this commitment, the RBC
Foundation is making a total of $2
million in donations to five Colleges in Atlantic Canada to support green skills
education and training across the region.
The College of the North Atlantic and Collège communautaire du
Nouveau-Brunswick will apply the donations to develop Electric
Vehicle education and applied skills training programs. The
Nova Scotia Community College and
New Brunswick Community College
Foundations will use the donations to support wind and solar
technician training programs, to help address the growing demand
for this skilled labour workforce in both provinces.
In PEI, a donation to Holland College Foundation will help fund
a four-year green retrofit project, to transform an existing campus
residential property into a model of energy efficiency and
sustainability.
You can learn more about The Growth Project and read the Growth
Challenge: Why the economy is stuck in neutral on RBC's new
Growth Hub.
About RBC
Royal Bank of Canada is a
global financial institution with a purpose-driven, principles-led
approach to delivering leading performance. Our success comes from
the 98,000+ employees who leverage their imaginations and insights
to bring our vision, values and strategy to life so we can help our
clients thrive and communities prosper. As Canada's biggest bank and one of the largest
in the world, based on market capitalization, we have a diversified
business model with a focus on innovation and providing exceptional
experiences to our more than 18 million clients in Canada, the U.S. and 27 other countries. Learn
more at rbc.com.
We are proud to support a broad range of community initiatives
through donations, community investments and employee volunteer
activities. See how at rbc.com/community-social-impact.
SOURCE RBC