Half-Century of Stagnation: Labor Productivity in Ontario’s Gold Mining Industry

Robert J. Petrunia and Karl Skogstad

International Journal of the Economics of Business, 2024, vol. 31, issue 1, 25-47

Abstract: This paper explores labor productivity in Ontario’s gold mining industry from 1920 to 1970. The gold produced by a worker is nearly identical in 1920 and 1970, suggesting that the industry experiences no productivity gains over this period. Further, labor productivity in the intervening years was nearly 30% lower than these values, raising concerns about the ability of the industry to remain profitable given a fixed gold price. We look at over 180 different Ontario gold mines comprising nearly the entire industry to determine whether workers become less efficient over time, or whether other factors, such as entry and exit into the industry, declining ore quality, or changes in capital stock, are the primary drivers of this stagnation. This analysis considers the impact of events, such as a sudden 70% rise in the price of gold in 1934, World War II, and the post-war subsidization of the industry on productivity within the industry.

Date: 2024
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DOI: 10.1080/13571516.2023.2260107

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