--- canonical_url: "https://csls.ca/ipm-archive/ipm-issue-28/employment-and-productivity-exploring-the-trade-off/" title: "Employment and Productivity: Exploring the Trade-off" author: name: "CSLS" url: "https://csls.ca/author/cslc/" date_published: "2026-07-13T07:40:44+00:00" date_modified: "2026-07-13T07:40:44+00:00" post_type: "ipm" summary: "" ipm_issue_period: - "Spring 2015" ipm_keyword: - "Canada" - "capital intensity" - "employment" - "industry-level" - "labour quality" - "MFP" - "OECD" - "productivity" - "reallocation" - "trade-off" ipm_research_theme: - "Labour" ipm_country_focus: - "Canada" - "G-7" - "International" - "OECD" featured_image: "https://csls.ca/wp-content/uploads/2026/06/IPM_50_banner.webp" status: "publish" --- # Employment and Productivity: Exploring the Trade-off Canonical URL: https://csls.ca/ipm-archive/ipm-issue-28/employment-and-productivity-exploring-the-trade-off/ # Employment and Productivity: Exploring the Trade-off [Download full PDF article](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-28-4-Tang.pdf) Cite this article × Cite this article as: Tang, Jianmin. 2015. “Employment and Productivity: Exploring the Trade-off.” International Productivity Monitor, No. 28 (Spring 2015): 63–80. https://www.csls.ca/ipm-archive/ipm-issue-28/employment-and-productivity-exploring-the-trade-off/ ## Author: - Jianmin Tang Innovation, Science and Economic Development Canada ## IPM Issue 28 Spring 2015 pp. 63–80 ## Related IPM articles [Is the SNA Still Useful? 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This article re-visits the issue. It shows that employment growth may be negatively correlated with productivity growth at the industry level. But this is not a trade-off. It is an outcome of market forces in reallocating production resources to rebalance changes in demand and supply conditions of different industries within an economy. At the aggregate level, employment growth may also be negatively correlated with labour productivity growth through its negative influence on capital intensity and labour quality. But, after controlling for those input factors, this article finds that employment growth does not negatively affect multifactor productivity growth. IS THERE A TRADE-OFF BETWEEN employment La perspective d’un compromis entre la croissance de l’emploi et la croissance de la productivité peut créer de l’incertitude chez les décideurs qui s’efforcent de créer des emplois tout en cherchant à améliorer la productivité. Cet article revient sur la question. Il montre que la croissance de l’emploi peut être négativement corrélée avec la croissance de la productivité au niveau sectoriel, mais que ce n’est pas un compromis : c’est le résultat des forces du marché dans la réaffectation des ressources de production pour rééquilibrer les variations des conditions de l’offre et de la demande dans différentes industries. Au niveau agrégé, la croissance de l’emploi peut également être négativement corrélée avec la croissance de la productivité du travail par son influence négative sur l’intensité du capital et la qualité de la main-d’œuvre. Mais après contrôle de ces facteurs d’intrants, cet article constate que la croissance de l’emploi n’affecte pas négativement la croissance de la productivité multifactorielle. [Download full PDF](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-28-4-Tang.pdf)