Canada’s Productivity Challenge and the Fiscal Path to Recovery

Watch Recorded Webinar
Macroeconomic Series title with coins and lighting effects in the background

Will Government Spending, Deficits Fuel Productivity, Growth?

In the context of trade tensions, lagging productivity, rising deficits, and government efforts to stimulate growth, this webinar examined Canada’s fiscal policy outlook for 2026 and beyond, and whether federal and provincial investment and tax levers intended to jumpstart the economy are likely to succeed. Federal and provincial fiscal paths are unsustainable without a material increase in productivity growth (roughly 0.7 to 1 percentage point higher per year), politically difficult tax and spending changes, or both. Canadians can expect sustained policy volatility: tax reform, regulatory changes affecting internal trade, sector specific competition initiatives, and evolving federal–provincial arrangements, all under high geopolitical and trade uncertainty.

Portrait of Trevor Tombe, a white man wearing glasses.

Trevor Tombe is a Professor of Economics at the University of Calgary and Director of Fiscal and Economic Policy at The School of Public Policy. He is also a Senior Fellow at the Macdonald-Laurier Institute and the Montreal Economic Institute, a Fellow at the Public Policy Forum, and co-director of Finances of the Nation.

Trevor’s research spans a wide range of topics in economics, including international and interprovincial trade, fiscal federalism, and public finance. He has published in leading academic journals and is co-author of the textbooks Public Finance in Canada and Macroeconomics.

Trevor regularly advises governments on economic and fiscal issues. He previously served on the Government of Canada’s Working Group on Productivity in the Public Sector, its Advisory Council on Interprovincial Trade, the Bank of Canada’s external review panel of its pandemic response, and the provincial AlbertaNext Panel. He contributes to public policy conversations through frequent op-eds, articles and media appearances.