Posted June 6, 2012
A recent study by the Centre for the Study of Living Standards (CSLS) has revealed that in 2010 Canada’s ICT investment per worker, expressed in current dollars, was 53 per cent of that of the United States – a gap of 47.0 percentage points. Some of the key findings of this CSLS study were:
• ICT investment growth in Canada in 2010 was 3.1 per cent – this is significantly less than the 7.1 per cent growth in the United States.
• Nominal ICT investment growth was less than nominal GDP growth in Canada in 2010, resulting in a fall in the ICT share of the business sector GDP. In the United States the reverse occurred as ICT investment growth exceeded GDP growth.
• The gap between Canada and the United States in ICT investment per worker in 2010 increased by 0.5 per cent from 2009.
(A complete copy of the CSLS study, “The Canada-U.S. ICT Investment Gap in 2010: The Widening Continues” is available at http://www.csls.ca/notes/Note2012-1.pdf.)
Many influential organizations view this widening gap as being directly related to Canada’s historical under-investment in productivity-enhancing information and communications technology tools and services.
For example, in its April 2009 report on innovation, the Council of Canadian Academies noted that “Growth of the hourly output of Canada’s business sector had been falling behind that of the United States for more than two decades, and the trend had deteriorated significantly since 2000. Investment in leading-edge technology – particularly related to computers and communications – was lagging significantly behind not only that of the United States, but also many of the advanced countries with which Canada compares itself.”
Ontario’s Task Force on Competitiveness, Productivity and Economic Progress in its 2011 report “Canada’s innovation imperative” stated that “Canadian businesses continue to trail their US counterparts in investing in machinery, equipment, and software to make their workers more productive. Lower investment in information and communications technology (ICT) accounts for about a third of the difference. Higher investment in ICT, which consists of computers, software, and communications equipment, creates an opportunity not only to innovate in our business processes through the application of technology to automate routine tasks, but also – and more importantly – to overhaul entire business processes to deliver more value.”
ITAC, which commissions CSLS’ annual studies of the ICT investment gap, is committed to promoting and enhancing the unique contribution ICT can make to Canada's economy and society.
“As the national technology association we are uniquely aware that Canada’s relatively weak adoption of ICT is a major drag on its competitiveness and overall economic performance,” said Karna Gupta, ITAC President & CEO. “Consequently, one of our strategic thrusts is to work with private and public sectors to not only increase the technology adoption but also improve the utilization in a way that helps address this widening ICT investment gap.”
About the Information Technology Association of Canada (ITAC):
The Information Technology Association of Canada (ITAC) is the voice of the Canadian information and communications technologies (ICT) industry. ITAC represents a diverse ICT community spanning telecommunications and internet services, ICT consulting services, hardware, microelectronics, software and electronic content. ITAC's community of companies accounts for more than 70 per cent of the 572,000 jobs, $149.4 billion in revenue, $6.22 billion in R&D investment, $22.6 billion in exports and $11.8 billion in capital expenditures that the ICT industry contributes annually to the Canadian economy. ITAC is a prominent advocate for the expansion of Canada’s innovative capacity and for stronger productivity across all sectors through the strategic use of technology.
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For further information, please contact:
Senior Vice President, ITAC
(613) 238-4822 ext. 2223
Manager of Communications, ITAC
(613) 238-4822 ext. 2224