Individual GDP bogs down living standards

Manitoba trails behind most Canadian provinces and American states in economic well-being, according to a new study.

The Fraser Institute, a right-leaning think tank, compared provinces’ and U.S. states’ GDP per person, among other economic measures, in a report released Thursday.

It places Manitoba 56th of 60 jurisdictions. Most provinces and every state except Mississippi had a higher GDP per person in 2024 than Manitoba, the Fraser Institute calculated.

It used data from Statistics Canada and the United States Census Bureau.

“Productivity in particular for Manitoba has grown quite slowly — and that’s one of the biggest contributing factors to income growth,” said Jake Fuss, the Fraser Institute’s director of fiscal studies and the report’s co-author.

“If your productivity is not growing very fast in Manitoba, then that ultimately means your living standards, your incomes are not going to be growing nearly as fast.”

Fuss defines productivity as the amount of economic activity (or output) produced for each hour worked.

The Fraser Institute clocked a nine per cent increase in productivity in Manitoba from 2007 to 2024. However, the change is small compared to Saskatchewan (15.1 per cent), Alberta (15.6), and nearly every U.S. state. Washington, at the top of the list, logged a 65.8 per cent jump in productivity.

Manitoba’s GDP per person growth from 1999 to 2024 was, using 2017 dollars, $11,311. Fifty provinces and states saw more growth, the Fraser Institute’s report says.

As of 2024, Manitoba’s GDP per person was $52,480, in 2017 dollars. (The report uses 2017 dollars for comparison because it is a Statistics Canada practice.)

Just Saskatchewan and Alberta ranked worse than Manitoba for median employment income growth between 2010 and 2024.

Fuss pointed to government policy — “uncompetitively high” taxes and “burdensome” regulations — as the reason for slow productivity.

He advocated for lower personal income and business taxes. High government deficits, including in Manitoba, can “shake investor confidence,” he added.

The report ignores other living standard measures, such as life expectancy and income distribution — areas where Canada is faring better than the United States, said Fletcher Baragar, a University of Manitoba economics professor.

Average life expectancy in Canada is 82 years old; in the United States, it’s 79.

“My sense is that probably there’s a better work-life balance in Canada,” Baragar said, adding Americans are “working more hours in order to get … (the) higher income per capita.”

Canadian employees worked an average 1,687 hours in 2025, compared to the typical American’s 1,800, according to the Organisation for Economic Co-operation and Development (OECD).

Manitoba could take measures to boost its GDP, Baragar said: the private sector’s rate of investment in research and development is “relatively low.”

A C.D. Howe Institute report in December 2025 found Canadian business investment has been so weak since 2015, capital per Canadian worker is falling.

The return on investment for businesses is lower in Canada than the United States. In some sectors, this is because of higher taxes, said Manish Pandey, a University of Winnipeg economics professor. “The question is how to attract investment and how to make investment more productive.”

He’s watching technology and artificial intelligence investment boom in the U.S. and China. It’s partly why Canada lags behind the U.S. in growth, he said.

“The big story is … whether the government is the reason for why the return on investment is not as high in Canada relative to the U.S.,” Pandey said. “That is an open question — I don’t think there’s an answer to that.”

Lauren Stone, the Progressive Conservatives’ economic development critic, blamed the New Democrats for Manitoba’s low ranking.

“The NDP has not put economic growth as a priority,” Stone said. “Government has that responsibility to create a competitive environment that encourages businesses to invest, expand and hire and create jobs.”

(In the report’s timespan, the NDP formed government from 1999 to 2016 and 2023 to present; the PCs formed government from 2016 to 2023.)

Business Minister Jamie Moses pointed to the province’s waiving of retail taxes on manufacturing equipment and capital investments related to the federal Port of Churchill Plus project. The government adjusted its payroll tax to lower amounts small businesses pay.

Recent U.S. tariffs have a “massive impact” on Manitoba’s economy, Moses said. The provincial government is boosting workforce productivity through skills training programs, such as NextMB Jobs for Youth, he added.

Canadian provinces accounted for seven of the 10 lowest rankings in the Fraser Institute’s report, when looking at lowest rates of GDP per person. New Brunswick, Prince Edward Island and Nova Scotia ranked lower than Manitoba.

The findings are “a reminder that we cannot afford to be complacent,” Elisabeth Saftiuk, acting president of the Manitoba Chambers of Commerce, wrote in a statement.

Manitoba has critical minerals, clean energy, agriculture, advanced manufacturing and other assets attractive to investors. Creating conditions for businesses to invest “matters most,” Saftiuk wrote.

gabrielle.piche@winnipegfreepress.com