Output per hour worked fell 0.17 per cent from the first three months of the year, deepening an extended slump in labour productivity that the Bank of Canada has characterized as a crisis. In comparison, productivity in the U.S. increased 0.5 per cent over the same period, Statistics Canada reported. (The Logic)

Talking point: Weak productivity is a global concern, so much so that the International Monetary Fund’s in-house magazine devoted an entire issue to the subject this month. The problem is especially acute in Canada, which is experiencing a historic decline. That’s a challenge for the Bank of Canada because weak productivity makes the economy susceptible to inflation, as companies have less capacity to absorb price shocks and to keep up with demand. Separately, Statistics Canada said unit labour costs increased 0.8 per cent in the second quarter, down from 1.3 per cent in the first quarter. The central bank will welcome that result, as policymakers have made slower wage growth a condition for future interest rate cuts.