The union business is under duress in Canada and elsewhere, and that’s cause for concern on both sides of the labour-management table.
According to a recent Business Council of British Columbia (BCBC) report, union membership is shrinking in most Western economies as manufacturing jobs give way to those in the service sector.
In Canada, where the percentage of workers who are union members has been relatively stable, numbers are now dropping as upcoming generations of workers, many of whom have virtually no cultural connection to the labour movement, see less need for representation by a union. BCBC numbers show unionization in the country had dropped to less than 29% in 2014 from 37.6% in 1981.
That continued weakening of organized labour’s leverage in the marketplace threatens to yield a corresponding erosion in worker wages and benefits, especially at the lower end of the job market.
But the other concern raised by the BCBC report, especially for taxpayers and private-sector companies that compete with government for workers or clients, is the growing concentration of unionization in the public sector.
According to BCBC, more than 70% of Canadian public-sector workers now belong to unions compared with less than 20% of their private-sector counterparts. Coupled with the higher wages and benefits most public-sector workers receive compared with those in the private sector, that gap skews the human resources market in favour of government. Little wonder then that public-sector employment is growing faster than employment in Canada’s private sector. According to the Fraser Institute, it grew 22.6% between 2003 and 2013 while employment in the private sector increased 10.7% during the same period.
Organized labour has done much to improve wages and job conditions for workers in Canada, but relegating it to government monopolies that are not subject to marketplace economic realities does far more to burden taxpayers than to further the cause of working people.