A question about U.S. productivity growth and statistics: Statistics Canada and the Centre for the Study of Living Standards in Canada have each recently released comparisons of productivity change in Canada and the US. They claim that, contrary to previous reports and widespread claims by the usual slash-and-burn-social-services crowd, Canadian productivity growth has basically matched that in the US over the last decade or so. The Centre for the Study of Living Standards calculates that GDP/worker between 1989 and 1997 grew by 0.9% in both Canada and the U.S., but that GDP/hours worked actually increased more in Canada - 1.2% vs. 0.8% in the US. (I forgot to check, but I assume this is per year.) The big difference is in manufacturing, where US growth is greater. But the CSLSC study says that if industrial machinery and equiptment and electric and other electronic equiptment sectors are removed, US productivity growth is greatly diminished but unchanged in Canada. They cast doubt on the accuracy of US data (Dept. of Commerce) for these two sectors, noting that their output doubled over the time period while the rest of manufacturing output actually decreased in the 1990s. Any thoughts on why the output and productivity growth in these sectors is so great compared to others? How much of this is real? Was there some shift in the data methods or industry definitions? Bill Burgess
