Labour productivity of Canadian businesses edged down 0.1% in the second quarter following three consecutive quarters of growth. This decline followed a significant 1.3% increase in the first quarter.

The slight decrease in productivity in the second quarter reflects a recovery in hours worked after a quarter of decline, while growth in business output continued at a faster pace.

Real gross domestic product (GDP) of businesses rose 1.3% in the second quarter, up from 1.1% in the first quarter. This marked the third time in four quarters that GDP growth of businesses has been greater than 1.0%. As in the first quarter, growth was widespread in goods-producing and service-producing business industries. Only the agriculture and forestry sector posted a decline in production in the second quarter, falling for a third consecutive quarter.

GDP growth of businesses in the second quarter was accompanied by the largest increase in hours worked (+1.4%) since the fourth quarter of 2003 (+1.9%). Hours worked rose at a comparable pace in both goods-producing (+1.2%) and service-producing (+1.4%) businesses. They were up in every major industrial sector except agriculture and forestry (-1.3%), information and cultural industries (-0.8%) and utilities (-0.3%).