Investment in Machinery and Equipment is Essential to Canada's Future

Machinery and equipment (M&E) is one of the imperative factors that influence Canada’s living standards. M&E investment and development is vital for long-term productivity growth. Despite Canada’s resilience to the global financial crisis, it is still vulnerable to weak future growth due to lingering economic frailties such as low productivity. Canada trails in investment and adoption of information and communications technology (ICT), a sub-group of M&E and the foundation for technological advancement in today’s digital world, compared to a number of advanced economies. Our findings indicate lower investment in ICT combined with lower competition, lower spending in R&D, and barriers to foreign direct investment to be significant factors to Canada’s low productivity. To ensure that sustainable living standards are attained in the future, Canada will need to improve its productivity level, and increasing investment in M&E is an important part of it.