The challenge
Canada’s health and productivity challenge
Productivity determines how much value workers create, and ultimately supports better wages, jobs, and living standards.
For more than a decade, Canada has lagged the OECD in average GDP per hour worked, a key measure of productivity. Canada’s productivity in terms of GDP per hour worked,1 landed at US $59.40 in 2024, which is roughly 29% below the United States’ $84.11.2 Forecasts place Canada as the worst-performing advanced OECD economy over the next 40 years in real GDP per capita growth.3
Canada's productivity trails the United States by nearly 30%
Canada
US $59.40 per hour worked
United States
US $84.11 per hour worked
While many of the causes of Canada's lackluster productivity, such as poor business investment, have been known for years, what hasn't been adequately discussed is the extent to which health care both contributes to the problem and offers solutions to mitigate it.
Like productivity, health outcomes have been falling. The share of adults reporting very good or excellent mental health fell from 72.4% in 2015 to 59% in 2021, with the steepest drop among young adults aged 18 to 34.4 The picture on overall health is no better: after holding steady for two decades, the share of adults reporting very good or excellent health fell from 68.6% to 56.4% between 2015 and 2024, with the sharpest decline again among young adults aged 18 to 34.5
Health-adjusted life expectancy (HALE), the number of years a person can expect to live in good health, has fallen by 3.5 years since its peak in 2012, erasing more than a decade of progress.6 Wait times have also worsened: the median wait from general practitioner referral to treatment has more than tripled, from 9.3 weeks in 1993 to 28.6 weeks in 2025.7 For a working-age Canadian, that wait isn’t just stressful, it’s expensive. The Fraser Institute estimated that waiting for care cost Canadian patients over $4.2 billion in lost wages and productivity in 2025. That’s an average of more than $3,000 for each of the estimated 1.4 million Canadians in the queue.8
The drop in health over the last nine years
The impact of poor health on the productivity of the working-aged population extends beyond those who are sick to those with caregiving responsibilities.
Advanced economies like Canada require a vibrant workforce to boost productivity, the OECD stresses—one that is adaptable, mobile, skilled, and able to absorb change.9 However, people can’t learn new skills and technologies, move, or change roles if illness has removed them from the workforce, or forced them to take time off to care for a loved one. Demographic change adds urgency: one in five Canadians is now over 65, driving up demand for chronic disease management, long-term care, and family caregiving.10 While many Canadians are healthier and working later in life, the sheer number of older adults is driving up chronic illness and the need for caregiving. The result is sustained pressure on both health spending and labour force participation, making productivity-enhancing health reform more urgent.
Canada’s productivity agenda has focused on maximizing investment and technology while undervaluing the condition of human capital.11 No return on investment, innovation, or reskilling can be maximized if the workforce isn’t healthy enough to make use of it.
Canada is spending more on health than ever (likely about $400 billion in 2025, or 12.7% of GDP12), yet ranks below average on many health metrics.13 While our values dictate treating health as a shared social commitment, it also can and should be managed as deliberately as any other driver of growth.
This is exactly what Deloitte’s Health Productivity Gap framework is designed to help do.
Poor health affects productivity in ways that traditional metrics capture only partially, from reduced capacity at work to forgone participation, early exits from the labour force, and diminished long-term potential. The HPG estimates the economic output Canada loses when poor health limits people’s ability to participate in the labour force. By translating these health-related impacts into dollars, the framework shows where targeted action could recover lost output and strengthen Canada’s productive capacity—all while improving health.
