Entrepreneurs take pride in their productivity. We work longer hours than the typical employed person, and we like to boast about our efficiency and incredible level of output.
That's why it hurts to learn that Canada has a productivity problem.
In the latest episode of The Unsure Entrepreneur Podcast, I got to learn more about this major problem from Patrick Gill, Senior Director of Operations at the Business Data Lab at the Canadian Chamber of Commerce. Patrick joins me on the show to share his insights from his recent report, Prompting Productivity: Generative AI Adoption by Canadian Businesses.
We discuss some eye-opening topics like Canada's productivity gap, the transformative potential of generative AI (Gen AI), and the unique opportunities and challenges AI presents to small businesses.
What's at the heart of the problem?
Low productivity threatens Canada's standard of living, wages, tax revenue, and future job creation.
It's getting worse — according to the Bank of Canada, back in 1984, the Canadian economy was producing 88% of the value generated by the US economy per hour, but by 2022, Canadian productivity had fallen to 71% of that of the United States.
Canada's productivity has increased by less than 1% annually over the past decade, placing us second last in the G7.
While AI might be the solution, only 38% of Canadians view AI positively, making them more nervous about AI compared to other countries.
Canada’s lagging productivity and global competitiveness challenges have recently led the Bank of Canada to declare the situation an “emergency.”
Patrick points out how factors such as weak competition, underutilization of a highly skilled workforce, and insufficient investment in research and equipment have contributed to this trend. "Boosting our productivity is not just an economic imperative; it's a societal one," he explains.
What's the solution? The Canadian Chamber of Commerce believes Gen AI can help to solve Canada's productivity problem.
Almost 3 in 4 Canadian businesses (73%) have not even considered using Gen AI yet.
The challenge is a slow uptake of AI technology among Canadian businesses — especially small businesses. Almost 3 in 4 Canadian businesses (73%) have not even considered using Gen AI yet. Many businesses are naturally apprehensive about using AI or haven't yet figured out how to put it to work in their operations.
To help businesses get more comfortable using this amazing new technology, Patrick explains the role of AI in automating laborious tasks which allows workers to focus on higher-value activities. For example, AI-powered accounting software can help eliminate the need for error-prone manual data entry which can free up finance professionals for more strategic work.
In the podcast episode, we also tackle common fears about AI replacing jobs. Patrick points out that the primary use of AI is to augment workers' capabilities rather than replace them. "Only 13% of businesses that are early adopters of AI are looking to automate tasks to replace workers," he notes. For small businesses, AI offers practical applications such as improving content creation, customer service, and data analysis, all of which can significantly boost efficiency and output.
According to Microsoft, the average return on investment for companies using AI is $3.50 for every $1 invested.
One of the standout benefits of AI is its ability to provide small businesses with capabilities typically available only to larger companies. Patrick highlights how tools like ChatGPT can help write emails, create social media content, and even translate materials into different languages, making it easier for businesses to expand their reach. According to Microsoft, the average return on investment for companies using AI is $3.50 for every $1 invested. Small business owners can easily try these tools because many AI applications are available for free or at a low cost.
For entrepreneurs, Patrick's advice is clear: "Test something, experiment, measure that experiment, replicate it, and then scale it out." He stressed the importance of not being left behind as competitors adopt new technologies. By leveraging AI, Patrick believes small businesses can not only enhance their productivity but also gain a competitive edge in the market.
Click here to listen to the full episode on your favourite streaming platform.
Click to download the report ‘Prompting Productivity.’
Read the media release from the Canadian Chamber of Commerce.
Connect with Patrick Gill on LinkedIn.
[Photo credit: Patrick Gill]
[With statistics from the report 'Prompting Productivity']
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