The labour productivity of Canadian businesses rose 0.3% in the first quarter as output and hours worked made a sharp decline, Statistics Canada said Tuesday.

StatsCan reported the gross domestic product of Canadian businesses and hours worked related to this production were both down sharply, posting the largest quarterly declines since the first quarter of 1991.

The agency said the downward movement in hours worked accelerated in the first quarter, down 2.2%, compared with the fourth quarter of 2008, down 1.3%.

Productivity in the goods sector grew 1.7% in the first quarter, despite a further decline in manufacturing, and was partly counterbalanced by a 0.5% productivity decrease in the services sector.

Productivity has followed much the same pattern in Canada and the United States over the last two quarters, the government agency said.

American businesses had a 0.4% gain in productivity in the first quarter, after a 0.1% decline the previous quarter.

IE