Efficiency of the Canadian secondary wood product manufacturing sector: Results from a national survey

In this paper, data from a 2017 national survey of Canadian secondary wood manufacturers was used to measure the efficiency of the sector. Efficiency is measured using the Data Envelopment Analysis (DEA) method. The results show the overall efficiency of firms across this sub-sector of the broader forest economy was low and this arises from the lack of technical efficiency more than scale efficiency, with about 4% of firms being technically efficient. Firm efficiency scores varied across provinces and business types. Results from regression analysis of the technical efficiency scores on various firm attributes and self-indicated constraints to firm growth show that large firms located in Quebec and in rural areas tend to have higher technical efficiency. In addition, financial constraints hinder companies’ overall efficiency in general. The results indicate the need for further policies that focus on supporting improved production techniques, technological innovation, management, and labour skills.