In this time of unusual uncertainty, businesses on either side of the border are responding in different ways. In the United States, investment has been relatively strong and productivity growth has been robust. However, hiring has been unusually weak, particularly by small businesses.
In Canada, the opposites have been the case: investment has been unusually weak; productivity, poor; and hiring, strong, particularly amongst small and medium-sized enterprises (SMEs). I would like to speak today about the possible reasons for these divergences, how long they are likely to persist, and their implications for growth and inflation in Canada.