The widespread labour unrest is taking different forms around the world, with unions in France, the UK, US, and Canada all flexing their collective muscles at the same time. At home, the current federal government strike is the largest single public sector strike in around two decades. Photo credit: The Canadian Press/Sean Kilpatrick
In many places around the world, it seems like the union movement has woken up on the wrong side of the bed and, as usual, is striking or considering going on strike.
There are several reasons for this, such as the end of the pandemic, during which a number of collective agreements expired but were not renewed for pandemic reasons and the fact that rampant inflation is hitting everyone in the pocketbook. As well, labour markets are generally tight as the baby boom generation retires – some earlier than planned because of the pandemic – fertility rates continue their decline in the developed world, and hours worked per week remain lower than their pre-pandemic levels.
Heavily indebted governments and businesses are looking for ways to cut their costs, and unions want to get their dibs in before the boom falls. The global economy is also slowing, suggesting that opportunities to coerce raises and other benefits out of employers will be scarce for the next few years.
The labour unrest is taking different forms around the world. In France, the always fractious unions have been revolting over a pension change President Macron is implementing. This change alters the general retirement age from 62 to 64 and removes some privileges from public sector workers. Macron pushed through this change by using a special constitutional power instead of leaving it up to a vote in parliament, which he seemed destined to lose. Most other European countries have already made a similar change, raising the official retirement age to 65 or older. Whatever political price Macron will pay for this pension reform is yet to be seen.
Former PM Stephen Harper made a similar change to Canada’s Old Age Security (OAS) program, gradually increasing over an extended period the eligibility for OAS (not the Canada Pension Plan) from 65 to 67. Foolishly, current PM Trudeau reversed this change, which means an added $15 billion in annual costs to general revenues. As all of these pension plans were devised at a time when people lived until about 70, the notion they can remain unchanged when average life expectancy has significantly increased and continues to do so, is ridiculous. Not changing retirement ages risks undermining the programs completely.
Unions in the UK are also up in arms, largely over the cost of living. Strikes have been widespread, involving unions in health care, transportation, education and railway workers, among others. Some of the impacts have been very serious, such as the cancellation of surgeries. There is no indication this will abate in the next few months. In fact, it is more likely to get worse and affect more sectors of the UK economy.
In the US, after years of declining membership, unions have become more aggressive. Strikes were up by 52 per cent in 2022 across a variety of different sectors. Unions also have undertaken active campaigns to unionize businesses such as Starbucks and Amazon, with the Starbucks unionization drive having had much more success to date than Amazon’s. Despite some recent wins for unions in the US, however, the overall rate of unionization continues to decline, and currently sits at about 10 per cent, about half of what it was in the 1980s.
In Canada, of course, we have the inevitable public sector strike. The current federal government PSAC (Public Service Alliance of Canada) strike is the largest single public sector strike in about 20 years. In addition to the usual wage demands, the union is asking for some pretty ridiculous things, such as a “social justice” fund to be administered by the union, an additional five days off for Indigenous employees, enshrining work-from-home rights in the collective bargaining agreement, extra pay for working past 4 pm and mandatory “unconscious bias” training in the workplace.
PSAC initially asked for a 4.5 per cent annual wage hike for three years. The government initially responded with 2 per cent, which they more recently increased to 3 per cent over three years. Considering that federal government workers are already paid significantly more than their private sector counterparts on average, enjoy generous pensions, early retirements, ironclad job security and other perks those of us who pay them can only dream of, the fact the union chose to strike with a generous 3 per cent offer on the table is outrageous. Furthermore, if government employees do get the right to work from home, that would reduce their expenses for commuting, clothing, meals and other items. This reduction in costs for workers would seem to justify a wage reduction, not an increase.
Trudeau has greatly increased the size of the federal government by about 30 per cent since 2015, so any increase in pay will be much more costly to taxpayers than it would have been previously. And as this is one of the first major collective bargaining exercises post-pandemic, it will also set a precedent for many other union negotiations in future months and years.
A couple of months ago, the Governor of the Bank of Canada Tiff Macklem noted how large wage increases would merely spur inflation on to greater heights. The Trudeau government should keep that foremost in their minds when negotiating the PSAC contract. Unfortunately, the extent to which Trudeau has expanded the federal government means that union dues have also been greatly increased, giving the unions a huge war chest with which to fight the government. You’d almost think the Trudeau gang have no idea what they’re doing.
If we didn’t have enough to worry about with a slowing economy, persistent inflation, a difficult geopolitical situation with China and Russia joining forces to challenge the West and a federal government that doesn’t seem to care much about the fortunes of average Canadians, our public sector union brethren seem determined to make things worse.
Maybe it’s time for we nice, calm Canadians to get a little more militant with these governments who constantly make decisions against our best interests. Give your Member of Parliament a call and let them know what you think. It’s a start.
She has published numerous articles in journals, magazines & other media on issues such as free trade, finance, entrepreneurship & women business owners. Ms. Swift is a past President of the Empire Club of Canada, a former Director of the CD Howe Institute, the Canadian Youth Business Foundation, SOS Children’s Villages, past President of the International Small Business Congress and current Director of the Fraser Institute. She was cited in 2003 & 2012 as one of the most powerful women in Canada by the Women’s Executive Network & is a recipient of the Queen’s Silver & Gold Jubilee medals.