Canadian labor productivity jumps as hours worked drop faster than output

OTTAWA, Sept 2 (Reuters) - Canada’s labor productivity grew by a record 9.8% in the second quarter as hours worked plummeted at a much faster pace than business output amid closures to slow the spread of the coronavirus, Statistics Canada said on Wednesday.

The gain was the second consecutive quarterly record, following a revised 4.5% rise in the first quarter. Productivity is a measure of business output per hour worked.

The COVID-19 lockdown measures that began in March and remained in place until early May led to historic declines in both business output and hours worked, StatsCan said, with hours worked falling at a much faster pace than business output.

That disconnect resulted in “considerable productivity growth,” the agency said.

Hours worked in the business sector fell 22.1% in the second quarter, more than three times the decrease in the first quarter. Service-producing businesses were hardest hit, with hours worked falling 53.1% in accommodation and food services, and 51.1% in arts, entertainment and recreation.

Employment also tanked in the second quarter, plunging a record 22.7%, while hours worked per job rose 0.7%, StatsCan said. The number of people absent without pay nearly doubled. (Reporting by Julie Gordon in Ottawa Editing by Paul Simao)