Business Investment Per Worker Falls in Eight of 10 Provinces as Alberta Drops 2.8% a Year

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Canada’s investment problem is no longer confined to national averages. Between 2018 and 2025, employment expanded faster than the inflation-adjusted stock of non-residential capital in eight provinces, leaving less productive capital available for each worker. Alberta recorded the widest gap, with its effective capital-per-worker measure falling by approximately 2.8% annually.

The comparison covers assets such as plants, machinery, equipment, engineering infrastructure and intellectual property after accounting for depreciation. It is a broad provincial measure that includes public and private investment, although businesses account for most Canadian fixed investment. British Columbia and Quebec were the only provinces where capital growth exceeded employment growth. Everywhere else, expanding workforces were not matched by an equivalent increase in the tools, technology and infrastructure that support productivity.

British Columbia Builds Capital Faster Than Its Workforce

British Columbia was the strongest performer by a considerable margin. Its real net stock of non-residential capital grew by an average of 4.19% annually between 2018 and 2025, while total employment increased by 1.38%. That produced a positive gap of roughly 2.8 percentage points a year, making British Columbia one of only two provinces where capital availability per worker improved.

Several unusually large projects help explain the result. Construction connected to LNG Canada’s first phase, the Coastal GasLink pipeline, the Trans Mountain expansion and the Site C hydroelectric project added billions of dollars’ worth of engineering infrastructure. These are long-lived assets whose economic value remains in the capital stock after construction workers leave the site.

The result should still be interpreted carefully. British Columbia’s performance was supported by a concentrated group of megaprojects rather than uniformly strong investment across every industry. Maintaining that momentum will require another generation of projects, alongside greater spending on machinery, software and technology by smaller businesses.

Alberta Suffers the Largest Per-Worker Decline

Alberta recorded the most severe deterioration. Its inflation-adjusted stock of non-residential capital decreased by an average of 1.05% annually from 2018 to 2025, even as employment grew by 1.74%. The difference translates into an effective capital-per-worker decline of approximately 2.79% a year, rounded to the 2.8% highlighted in the headline.

That combination matters more than either figure on its own. Alberta was not simply adding workers faster than it built new assets. The existing stock of plants, equipment, engineering structures and intellectual property was shrinking after depreciation. A growing workforce was therefore being spread across a smaller real capital base.

The decline is especially striking because Alberta historically maintained one of Canada’s most capital-intensive economies. Oil sands facilities, pipelines, processing plants and heavy equipment require enormous upfront spending. When major projects slow, the impact on provincial capital formation can be dramatic. Alberta remained a major destination for investment in absolute terms, but its recent additions were insufficient to replace depreciating assets and keep pace with employment.

Saskatchewan’s Capital Base Shrinks as Employment Expands

Saskatchewan experienced the second-largest per-worker decline. Its real net stock of non-residential capital contracted by an average of 0.44% annually, while employment rose by 1.49%. The resulting gap was approximately 1.93 percentage points each year.

Like Alberta, Saskatchewan depends heavily on industries requiring large quantities of physical capital. Potash mines, oil facilities, grain-handling systems, power infrastructure and agricultural machinery can generate significant investment during expansion periods. They can also create sharp declines when projects are completed, commodity conditions weaken or producers become reluctant to approve new developments.

The numbers do not suggest that Saskatchewan stopped investing altogether. Businesses and governments continued replacing equipment and building assets. The problem is that gross spending was insufficient to overcome depreciation and workforce growth. For a worker, the practical concern is whether increasingly productive equipment is being introduced quickly enough. A mine, farm or processing facility can hire additional employees, but output per person may struggle to rise when machinery, technology and supporting infrastructure fail to expand at the same pace.

Manitoba Adds Workers Much Faster Than Productive Assets

Manitoba’s non-residential capital stock remained almost flat, growing by only 0.11% annually between 2018 and 2025. Employment, however, expanded by 1.29% a year. That left an estimated annual capital-per-worker shortfall of approximately 1.18 percentage points.

The result represents a major slowdown from 2014 to 2018, when Manitoba’s net non-residential capital stock grew by an average of 2.8% annually. Investment did not collapse into negative territory during the more recent period, but it came close to stagnating after depreciation was included. Employment continued rising regardless.

For Manitoba businesses, the trend can appear in ordinary operational decisions. A manufacturer may add another production shift rather than install a new automated line. A transportation company may hire more drivers without expanding its fleet proportionately. A food processor may postpone replacing machinery because borrowing costs or uncertain demand make the investment difficult to justify. Those choices can preserve employment in the near term, but relying on additional labour instead of better capital limits how quickly output and wages can grow over time.

Ontario’s Investment Growth Cannot Match Its Hiring

Ontario’s non-residential capital stock grew by a comparatively respectable 1.87% annually. However, employment expanded even faster, averaging 2.27% growth. The difference left the province with an effective decline in capital per worker of roughly 0.4% a year.

Ontario’s outcome demonstrates why investment totals can be misleading when viewed without the workforce. A province can attract factories, data centres, warehouses and transportation projects yet still experience capital thinning if hiring and population growth move faster. Ontario added large numbers of workers during the period, increasing the amount of investment required merely to maintain the existing capital-to-labour ratio.

The province’s industrial diversity also matters. Ontario contains highly capital-intensive automotive, manufacturing and utilities operations, but much of its employment growth occurs in service industries that generally require less physical capital per employee. That mix can reduce the provincial average. Nevertheless, digital systems, software, intellectual property and advanced equipment remain important in service businesses. The challenge is not simply building more factories; it is ensuring that companies throughout the economy invest enough to make a rapidly expanding workforce more productive.

Quebec Emerges as One of Only Two Positive Performers

Quebec narrowly avoided the broader provincial decline. Its real net stock of non-residential capital grew by 1.81% annually, compared with employment growth of 1.47%. That produced a positive capital-per-worker gap of approximately 0.34 percentage points per year.

The margin was modest, but its direction was important. Quebec and British Columbia were the only provinces where capital growth exceeded employment growth between 2018 and 2025. Quebec also improved from its 2014-to-2018 performance, when its non-residential capital stock grew by just 0.6% annually.

Quebec’s result reflects an economy containing substantial manufacturing, aerospace, electricity and transportation infrastructure, alongside growing technology and service industries. Large capital projects can lift the provincial stock, while spending on software and intellectual property can strengthen productivity without creating highly visible construction sites. Still, Quebec’s advantage over employment growth was relatively small. A few weaker investment years could erase it. The province’s performance is therefore better described as gradual capital deepening than an investment boom, particularly when measured against the much faster rates historically associated with strong productivity growth.

New Brunswick Records Growth Too Weak to Cover Hiring

New Brunswick’s net stock of non-residential capital increased by only 0.19% annually from 2018 to 2025. Employment grew by 1.43%, creating an estimated capital-per-worker decline of about 1.24 percentage points a year.

The figures illustrate the difference between positive investment and sufficient investment. New Brunswick’s capital stock did not contract outright after depreciation, but its growth was barely above zero. Meanwhile, the workforce expanded more than seven times faster. Maintaining capital per worker would have required significantly more investment in commercial buildings, industrial equipment, transportation networks, utilities and intellectual property.

Smaller provincial economies can also experience greater volatility when one major facility opens, closes or completes an upgrade. A single refinery turnaround, port project, power-sector investment or manufacturing expansion can noticeably affect annual totals. That makes long-term consistency especially important. For local employers, modest investments that improve logistics, digitize operations or replace outdated machinery may not command national attention, but collectively they determine whether employees gain access to better tools—or whether businesses continue adding labour while stretching existing assets more thinly.

Nova Scotia’s Employment Boom Outruns Capital Formation

Nova Scotia’s real non-residential capital stock grew by an average of 0.61% annually, while employment increased by 1.72%. That created an effective capital-per-worker decline of approximately 1.11 percentage points each year.

The province’s workforce growth was among the strongest outside Ontario, Alberta and Prince Edward Island. Population gains and expanding service industries supported additional hiring, but productive assets did not keep pace. The result is particularly relevant for a province seeking to turn population growth into lasting improvements in income and output.

More workers can expand the economy, yet sustainable gains in living standards generally require each employee to produce more over time. That can mean modern diagnostic systems in health-related businesses, automated equipment in food processing, better software in professional services or upgraded facilities at ports and industrial sites. Without such investments, growth becomes increasingly dependent on adding people rather than increasing what each person can produce. Nova Scotia’s modestly positive capital growth therefore masks a more difficult underlying story: investment exceeded depreciation, but not by enough to support its rapidly expanding workforce.

Prince Edward Island Nearly Keeps Pace With Rapid Hiring

Prince Edward Island posted one of the country’s fastest increases in non-residential capital, averaging 2.9% annually. Yet employment grew even faster at 3.23%, leaving a comparatively small per-worker decline of approximately 0.33 percentage points a year.

That makes PEI an unusual member of the group. Its capital-per-worker measure declined not because investment was weak in absolute growth terms, but because its labour market expanded exceptionally quickly. The province came much closer to maintaining its capital-to-worker ratio than Manitoba, New Brunswick, Nova Scotia or the three resource-producing provinces with contracting capital stocks.

PEI’s small economic base means individual construction, utility or industrial projects can have an outsized effect on its percentages. The underlying report consequently warns that capital figures for smaller Atlantic provinces may be more volatile. Even so, the comparison identifies a clear challenge. Rapid population and employment growth increase demand for commercial facilities, transportation capacity, digital infrastructure and equipment. Unless investment continues at an unusually strong pace, new workers may arrive faster than businesses and institutions can provide the productive assets needed to support them.

Newfoundland and Labrador Reverses Its Earlier Investment Surge

Newfoundland and Labrador’s non-residential capital stock declined by an average of 0.67% annually between 2018 and 2025, while employment grew by 0.85%. Together, those movements produced an effective capital-per-worker decline of approximately 1.52 percentage points per year.

The turnaround was dramatic. From 2014 to 2018, the province’s net non-residential capital stock had grown by an average of 6% annually—the strongest result in Canada. The later contraction may partly reflect the completion of major energy, hydroelectric and mining developments. Once a large project enters operation, construction spending falls even though the finished asset continues contributing to production.

That project-cycle effect does not eliminate the longer-term concern. Depreciation continues as offshore facilities, machinery and infrastructure age, requiring new investment simply to preserve their real value. Employment also returned to positive growth after declining during the earlier period. Newfoundland and Labrador therefore moved from rapidly building capital while employment fell to losing capital while employment increased. It captures the national challenge in concentrated form: completed megaprojects can create prosperity, but a continuing pipeline of replacement, expansion and modernization is needed to sustain capital per worker.

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