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Oct 13, 2023

Is It Too Late to Save Canada's Productivity?

by Hugues Foltz Executive vice-president

Digital transformation, Artificial intelligence

Groups of entrepreneurs, associations from various industry sectors and our governments have recently realized the severity of the crisis we are facing. And here I'm not talking about the global ecological crisis but about the poor performance of Canadian businesses regarding productivity.

The labour shortage is undoubtedly contributing to a part of this problem. In fact, it amplifies and accelerates the problem globally. The lack of workforce makes many companies unable to deliver all their customer orders. Unfortunately, this also means many entrepreneurs focus on solving their labour problem instead of initiating digital transformation.

In my opinion, the recent increase in awareness about the importance of productivity in Canada can be attributed to the resurgence of a study carried out by the OECD in 2021. This rather alarming report on Canada highlights various factors such as GDP, growth in purchasing power and labour utilization in Canada. The report's conclusions are catastrophic for our country’s future. In short, it predicts that Canada will rank last among all OECD developed countries in terms of productivity. Last out of 38 countries! And once we reach this position, it will take us three decades to get out of it. We'll be too far behind in innovation and automation to reverse the situation any faster!

Remember that a country's productivity goes far beyond its economic performance. It is also a key indicator of its ability to create high-quality jobs and improve living standards for its citizens. In the current climate, it may be hard to imagine that a fall in productivity could lead to wage cuts and higher unemployment, but in reality, it could happen if we carry on down this path!

Unfortunately, the core of the problem goes far beyond a simple lack of productivity in our companies. Entrepreneurs and managers in our society lack enthusiasm for innovation and new technologies. Despite the world's current focus on sustainable development, resource scarcity and ecology, we are hesitant to embrace change our ways too quickly out of fear of change. Shockingly, a recent report by Scale-AI revealed that only 44% of Canadians trust artificial intelligence, placing us 3rd to last on the world trust ranking! How can we expect our companies to implement artificial intelligence in their processes when 66% of the population distrusts it? Just imagine how far behind we are falling compared to companies worldwide jumping into AI with both feet.

Artificial intelligence solutions are becoming increasingly cross-functional, transforming entire industries at an impressive rate. Let's take ChatGPT as an example: how many jobs do you think it will change, and how many do you think it will just make disappear? My answer: hundreds, if not thousands!

According to a study conducted by Bloomberg four years ago, at least 40% of the jobs we know today will either cease to exist or be drastically transformed by 2030. Does this percentage seem high to you?

It's possible that in a few years, you may have to change your career path to become an augmented reality designer, virtual store manager, robot trainer, or drone traffic controller.

Just like how Excel revolutionized the accounting world, not by replacing accountants but by making them far more efficient, technologies like ChatGPT can positively transform how people work. A few months ago, who would have thought that doctors would be saying that ChatGPT is more important to healthcare practitioners than a stethoscope? So, imagine the impact of such technology on your profession!

Going back to my question: is it too late to save Canada's productivity? I would argue that it is not. However, there's a nuance to my answer. If we want to catch up with other world leaders, we must stop being reluctant towards proven technologies and get out of the "resistant" zone to embrace all the new technologies, including artificial intelligence!