Canada's central bank sees AI as a productivity lever, but warns uneven adoption could leave some workers and industries behind
Canada's central bank is offering its clearest picture yet of how artificial intelligence is transforming the country's economy: the technology is already at work, but the seismic disruption many feared has not yet arrived.
Speaking to economists and business leaders in Ottawa, Bank of Canada external deputy governor Michelle Alexopoulos addressed how AI is affecting the economy today, as well as what could unfold in the future.
Her remarks arrived at a moment when the debate over AI's role in financial services – from underwriting to client management – has intensified across the Canadian mortgage sector.
"As AI continues to improve and its adoption spreads, it could permanently change how the Canadian economy works," Alexopoulos said.
"By lowering costs for businesses and improving efficiencies, AI could support higher wages, reduce prices for consumers and spur new investment."
The speech, delivered at the Ottawa Economics Association and Canadian Association for Business Economics Spring Policy Conference, drew on data from Statistics Canada and the Bank's own surveys of businesses, consumers, and financial sector risk managers.
A technology with GPT potential, but still early days
Alexopoulos drew a distinction between ordinary technological advances and what economists call general-purpose technologies, or GPTs – transformative innovations such as electricity and computing that eventually reshape entire economies.
She said AI has many characteristics of a GPT, but not all of them yet, noting that the technology is still in early stages of adoption and it remains uncertain whether AI will spread through the entire economy and create spillovers like computers, or plateau as a powerful but task- or sector-specific technology.
She pointed to a dramatic acceleration in investment as a signal of AI's growing weight.
AI-related capital spending by top US technology firms roughly doubled to approximately US$400 billion in 2025 and is expected to continue rising – a scale of commitment that should eventually make accessing advanced AI tools cheaper and easier for Canadian businesses.
Despite that investment, domestic adoption remains concentrated. A 2022 Statistics Canada study found about 3% of Canadian businesses were using AI.
By 2025 the share had quadrupled to around 12%, but AI adoption differs sharply across sectors: just 1.5% of businesses in accommodation and food services are using AI, compared with more than 30% of finance and insurance firms.
Read more: Bank of Canada warns AI boom could leave smaller firms behind
Humans remain in charge – for now
For workers in any AI-exposed sector, the jobs question is the most personal. The Bank's current reading is cautious but not alarming.
Almost 90% of Canadian businesses that have adopted AI reported no effect on staffing levels, with roughly 4% saying AI had led to job creation and about 6% reporting decreases in employment linked to AI use.
In its most recent survey of senior experts in risk management in the financial sector, the Bank found that many said AI use was improving productivity by automating routine tasks, allowing workers to focus on higher-value ones.
Looking ahead, those experts see AI as a tool to support decision-making, while still keeping humans very much in charge of those decisions. Alexopoulos framed this as evidence that AI will mostly transform jobs rather than eliminate them.
That assessment resonates in the mortgage broker community. Vancouver-based broker Sharon Davis told Canadian Mortgage Professional late last year that brokers' ability to produce tailored solutions for a client's extremely specific needs and contexts is something that will continue to set them apart from automated tools.
"AI doesn't think that way," Davis said. "AI doesn't say, 'Well, let's look at everything.'"
Her counsel was direct: "We have to be a hybrid. We need AI to keep us moving forward and help us be more efficient."
Tim Rye, senior vice president of commercial solutions at Teranet, offered a complementary view last month.
"AI is coming. Tools and technologies are coming faster, and we're seeing it more and more," Rye told CMP.
"I don't think we can avoid it. We have to embrace it, and we have to make sure we put protections, tools and partnerships in place to ensure a trusted ecosystem remains for the housing environment of Canada."
Alexopoulos acknowledged that not all workers will be insulated. She noted that some technology firms have attributed recent job cuts partly to AI, and studies have highlighted weak hiring in roles highly exposed to automation, including entry-level coding and customer service – a concern that could disproportionately affect younger workers and those in AI-exposed sectors.
Read more: AI is coming for brokers' back office. Some will adapt. Many will not
Beyond employment, the Bank's keenest interest in AI is what it could eventually do to Canada's long-stagnant productivity numbers and by extension, to the inflation outlook that governs interest rate decisions.
"Productivity is not about asking people to work harder," Alexopoulos said.
"It's about how efficiently the economy transforms work into goods and services. When productivity improves, living standards rise."
She added that productivity ultimately determines how fast the economy can grow without generating inflationary pressures – in other words, it shapes the economy's potential output.
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