Stretch Goal Reports
Glossary Words from the following Reports: Labour Productivity, Labour Force, Non-Residential Private Sector Investment, R&D Per Capita
Report: Real Non-Residential Private Sector Investment
Report: Labour Productivity
Report: Post Secondary Education and Research and Development
Summary Report
Importance
- To remain globally competitive, it is important to produce at lowest possible cost
- BoostNB has three investment goals
- Post-Secondary Research and Development
- Real Non-Residential Private Sector Investment
- Progress towards meeting these goals will improve Labour Productivity and spell success for the province
- High Investment can also signal that businesses trust the stability of New Brunswick
Problem
- New Brunswick is not progressing in any of the three goals related to investment and therefore is not capturing the full potential of its export industries
- Low levels of R&D and business investment hurt the competitiveness of New Brunswick businesses and cause low levels of labour productivity
- This indicates that businesses do not see New Brunswick as a viable option for starting or expanding their industries
Cause
- Some of NB’s lost labour productivity is a result of the aging New Brunswick workforce
- Older employees deliver lower levels of productivity
- Hesitancy rises as the province continues to struggle with gaining social license for some kinds of development
- New Brunswick consistently has low levels of business and consumer confidence, signalling further uncertainty in the province
In the Numbers
New Brunswick has the 2nd lowest R&D expenditures per capita in Canada at only 60% of the national rate. This leads to lower levels of innovation and hurts the productivity of New Brunswick workers.
Figure 1: Per Capita R&D Expenditure: All Sources (2012 Constant Dollars)
The problem in R&D funding is not isolated to any single sector, rather New Brunswick has lower than national rates in funding from all six major funders; Business enterprise, federal government, provincial government, private non-profit, foreign, and higher education. Figure 2 shows the sources of funding and the percentage of total that they account for.
Figure 2: New Brunswick R&D Funding by Source
Figure 2 shows that higher education makes up two thirds of the provinces R&D funding, but New Brunswick still has the lowest rates of any province. Other provinces only rely on higher education for 50% of their total R&D and still receive more funding per capita, this shows how far behind New Brunswick is, and is expounded on in our Post-Secondary Research and Development Goal.
Figure 3: Higher Education R&D Expenditure Per Capita (2012 Constant Dollars)
The other area that New Brunswick trails in is funding from the federal government. In this area also, New Brunswick ranks near the bottom, only ahead of PEI. Increased federal funding could kickstart the process of increasing R&D in the province. At present New Brunswick receives less than half of the national rate of federal R&D funding.
Figure 4: Federal Government R&D Expenditure Per Capita
All of this leads to lower levels of innovation in the province and lower levels of Labour pruductivity.
New Brunswick also has low levels of capital formation. This means that the New Brunswick labour force is not working
with the best available technology in the best available settings. With higher business investment and a younger, skilled workforce,
Labour pruductivity would increase. This is further explained in Non-Residential Private Sector Investment
Summary
Labour pruductivity can be understood as a function of Private Sector Investment and of Research and Development. New Brunswick has low expenditures on R&D from every major funder, but the deficits in federal funding, business expenditure, and higher education makes up the bulk of the problem. New Brunswick also has low levels of private sector investment because of the types of workers available in the province coupled with a business environment that potential investors do not apparently trust. Improving in these areas would increase average Labour pruductivity and make New Brunswick a more attractive place to do business, ultimately benefiting the economy.
Appendix
Appendix A: Total R&D Expenditures Per Capita (2012 Constant Dollars)
Source: https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=2710002501
Appendix B: New Brunswick R&D Expenditures Per Capita (2012 Constant Dollars)
Source: https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=2710002501
Appendix C: Higher Education R&D Expenditures Per Capita (2012 Constant Dollars)
Source: https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=2710002501
Appendix C: Federal Government R&D Expenditures Per Capita (2012 Constant Dollars)
Source: https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=2710002501
Appendix D: Business R&D Expenditures Per Capita (2012 Constant Dollars)
Source: https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=2710002501
