What can we do to make the Canadian economy grow faster?
Right now we should consider the magic ingredient, productivity, using labour and capital to the best advantage.
Hitherto the expansion of our economy did not necessarily involve better productivity. In the previous decades there were more employed and more factories and roads available to use them.
There now is a pronounced slowdown in population, and labour and plant equipment have not been used as efficiently as possible. Growth of this kind can last only as labour and capital are in infinite supply. Thus, in the long run improving productivity with which they are used is essential.
Hence, we in North America must deal with the economy.
In the 19th century Charles Bedaux, a Frenchman, developed a time motion management concept. A stop watch was used to determine the length of time production steps required. Workers resented that push for efficiency, so that approach did not continue.
Yet, we in North America should be concerned about the way forward for our economy. The key then is productivity, using labour most efficiently.
In the short run the skills and adaptability of the labour force will make a tremendous difference in the amount of output obtainable from the workforce and the existing capital equipment. In the longer term it is not so much dexterity as general education that determines the output from an individual worker. Hence a rising “stock” of education will make workers more productive, so we should do what we can to raise education levels.
Another source of improved productivity is the magnifying effect of mass production per unit of output. Usually when production reaches a certain size economies of scale seem possible. A complex operation should be changed if possible to a series of smaller ones, each performed at high speed by workers helped by specially-designed equipment. Mass production can be possible then. We should try to make that feasible.
Technology can be an initiator of productivity. During more recent decades GNP was based to an important extent on technology. That means using machines to displace labour. What is increasingly apparent is that this productivity enhancement is fueled by technology.
Thus, to improve productivity we should make every effort to enhance the use of workers through extensive education, try to use large-scale production when practicable, and to take advantage of technology, using the most modern developments.