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Brian Corcoran Wins 2018 Lynn Williams Award Labrador City, N.L. – It was a pleasure to attend the annual SOAR Chapter 6-SA1 Christmas dinner and dance on Dec. 14 2018. I was there to present the Lynn Williams Award for Service to Chapter President Brian Corcoran. People could not have been friendlier and more accommodating to me and the fact that all former presidents of the chapter were in attendance made the event especially memorable. The Canadian Lynn Williams Award is open annually to all chapters in Canada to nominate a person whom they believe has demonstrated exemplary service to the membership and community in keeping with SOAR’s constitutional mandate. The Canadian SOAR executive considers all written submissions and votes by secret ballot to select a winner. Each year the selection become more difficult as the number of quality nominees increases annually. Brian Corcoran is well-known in his community for his selfless service to others. For many years he has served as President of his Canadian Legion Branch as well as President of SOAR Chapter 6-SA1, where he keeps members well-informed of political and social issues and activism. Brian’s contributions to his community are too numerous to list, but here are a few examples. He is the go-to person for any senior who has problems with their social security pension or benefits, helping them navigate the complexities of government bureaucracies. He negotiates reduced air fares for seniors and others facing medical emergencies, given that residents of remote Wabush and Labrador City often must fly out of the community for treatment. There is not a community event or a fundraising effort that takes place without Brian’s active participation. Brian is in every respect the epitome of what Lynn Williams envisaged a SOAR chapter leader to be. He is a worthy recipient of this prestigious award. — Feb 5
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Health Care Activists Advocate Universal Pharmacare on Parliament Hill More than 100 public health care advocates, including members of the United Steelworkers, visited MPs on Parliament Hill last week to push for universal public pharmacare. While we in Canada currently enjoy universal health care, this currently does not include prescription medications, with levels of drug coverage varying across the country. This patchwork system leaves many Canadians paying out of pocket for prescription drugs. Nearly one in four Canadians reported that they or someone in their household did not take their medications as prescribed in the past 12 months because of cost, according to information distributed by the Canadian Department of Finance in June 2018. An estimated one million Canadians were forced to cut back on food or heating in order to afford prescription medications. Momentum has been building for universal prescription drug coverage. The federal government appointed an advisory council last year to research options for how to implement such a system. It is due to receive the final report in spring 2019. Pharmacare will be an issue in the Canadian federal election, scheduled for October 2019. Activists scheduled more than 100 meetings with MPs and other officials on Jan. 29 to advocate for national pharmacare that meets five core principles: that it be comprehensive, affordable, accessible, publicly funded and publicly administered. To read more about the lobbying effort, click here and here. — Feb 5
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USW Takes Part in Week of Solidarity with Garment Workers in Bangladesh Bangladeshi garment workers are telling us that more than five years after the Rana Plaza disaster the struggle for better and safer working conditions in Bangladesh is ongoing. The United Steelworkers union is one of the many voices asking Bangladesh to effectively implement the Bangladesh Accord for Building and Fire Safety, which would make the textile and garment industry safer for workers there. For the past two months, garment workers have been taking to the streets in massive numbers to demand a decent living wage for their work. The protests have been met with violence and repression by Bangladeshi authorities. As part of a worldwide week of solidarity, USW urges Bangladesh to respect labour rights and to stop repression against garment workers. Click here to read a letter from Ken Neumann to the Bangladesh High Commission in Ottawa. — Feb 1
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What Happened to (Real) Wage Growth? The Canadian economy saw improvements in 2016, in comparison to 2015, growing at 1.4%, but well behind its 2.6% average growth in 2013-2014. In 2017, economic growth exploded to 3%, only to slow down in 2018 to 2%. During this period, the unemployment rate declined from 7.2% in January of 2016 to 5.6% in December of 2018 – the lowest unemployment rate Canadian workers have seen since the late '70s. With the economy performing at full capacity, and the labour market in a state of virtual full employment, the Bank of Canada has increased the overnight interest rate five times since January 2016, hoping to maintain inflation expectations within the target range of 1-to-3%. While the Bank of Canada has cited the increased debt load that Canadians are carrying as well as snail’s-paced wage growth as causes for concern, it has continued to hike up interest rates so it has room to manoeuvre and ‘hike down’ when the next economic downturn emerges. Although the necessity of continuing to hike interest rates is questionable, given the concerns cited by the Bank of Canada and mild inflation, one thing is certain: increasing interest rates risk slowing down economic growth, and with it, eliminating the existence of tight labour markets, conditions in which workers’ bargaining power is generally in a more favourable position. What happened to my wages? While the unemployment rate has declined to rates unseen since the late ‘70s, workers’ real wages have largely remained stagnant during this period. Figure I: Non-Management Nominal Wage Growth, 2016-2018 In standard economics approaches, a tightening labour market and a subsequent scarcity of jobs generally translates into workers’ wages being bid up by employers. As employers race to find workers from a shrinking supply, they try to outbid other employers as a means to secure workers' services. In other words, tightening labour markets are generally conducive to workers’ bargaining power, as workers have plenty of options to sell their capacity to work. For workers, tight labour markets mean it’s a sellers’ market. Figure I, above, broadly captures this trend. From January 2016 to December 2018, the unemployment rate declined 7.2% to 5.6%. During this time, non-management workers’ nominal wages―the money price of their wages―increased by 5.6%. Most of the wage growth that workers experienced occurred in late 2017 to early 2018. It would appear that workers largely benefited and saw their living standards increase in the previous three years. During the same period, however, workers’ real wages – wages adjusted for inflation, i.e., purchasing power – have stagnated. [See Figure II, below] While, since January 2016, nominal wages for non-management workers (80% of the population) have grown 5.6%, real wages have grown by less than 0.5% (0.37%). Real wage growth for workers in traditional industries was particularly bad; blue collar workers[1] saw their wages decline by half a percent, while workers in manufacturing saw their real wages decline by 1.26%. Although workers as a whole have seen their wages stagnate – and decline in some cases – in the past few years, some workers have seen their real wages increase. Those in the bottom 20%[2], most of whom either directly or indirectly benefited from some type of minimum wage increase across a number of provincial jurisdictions, saw their real wages increase by 3.54%, while the bottom 40%[3] saw real wage increases of 1.57%. Non-management workers employed in sales and service occupations, a group which benefited directly and indirectly from minimum wage increases, saw an increase of nearly 4% in real wages. In global terms, workers continue to make essentially the same amount of money – in purchasing power terms – in 2019 as they did in January 2016. While those at the bottom end of the labour market saw their real wages increase, this was arguably due more to political intervention in the form of legislated minimum wage hikes and its spillover effects than to the natural workings of the forces of supply and demand of the market. During the same period, management, which composes approximately 9% of the population, saw their nominal wages grow by 10.2% and their real wages increase by 4.7%. Senior managers (CEOs, CFOs, VPs etc.), who compose 0.29% of the employed population, have seen their nominal wages grow by 17.6% and their real wages grow by 11.64%. While the vast majority saw their wages stagnate, those in the top 10% and 1% saw their purchasing power increase. Why has this been the case? Why has workers’ purchasing power stagnated in the face of an expanding economy and tightening labour market—a condition which is generally conducive for workers’ real wages to grow? The business press, bank economists and even the Bank of Canada can’t seem to understand why. What was once a relationship that was largely taken for granted (tight labour markets=higher real wages), has been so weak, even flat, in the most recent business cycle(s). Workers and those in the labour movement can help them understand. While it seems obvious to many in the trade union movement, it is less so to the economic elites and their policy wonks in government. Workers’ wages continue to stagnate, because for 40 years, workers’ organized bargaining power has been attacked from all sides. In industrial relations, legislative changes have made it more difficult for workers to organize into unions and engage in collective bargaining; employers themselves have become progressively anti-union, often using dirty and illegal methods to ward off unionization, or worse, moving to low-wage jurisdictions to manufacture goods. In trade policy, our governments, at the behest of the economic elite, have sought to sign trade agreements which place our workers in direct competition with low-wage workers, in addition to permitting an influx of cheap imports from countries with dubious labour standards. In economic policy, government after government has sought to cut and eliminate social services, scale back labour market supports (like E.I.) and chase balanced budgets no matter what the cost and who it affects. In monetary policy, central banks have focused solely on controlling inflation instead of encouraging employment growth, as they are mandated to do, in order to satisfy financial markets and interests. The result? A progressive decline in union density, particularly in the private sector. In one sentence, policies and actions enacted on the shop floor, in society and in government, by employers and Liberal and Conservative governments, have sought to destroy workers’ bargaining power, and in particular, organized bargaining power—the organized capacity of workers to compel employers to pay more than what the ‘market’ (i.e., employers) allocates. That, and only that, is the reason why workers’ real wages continue to stagnate despite economic growth. Without organized bargaining power, without a strong workers’ movement and a capacity to periodically bargain over the price of their labour-power, workers’ ability to increase their real wages, and thus improve their living standards above what the market provides, will fail and wages will continue to stagnate. It is obvious that if workers’ living standards are to increase, their purchasing power must also increase. In other words, their money wages have to rise faster than inflation. If enough workers can organize strong unions, they can force employers to share some of their profits without driving up inflation too much. Faced with strong unions pushing for higher wages on the one hand, and competitors keen to take away market share by keeping lower prices on the other, employers will not pass on the full cost (or any) of increases to prices, and instead (made to, through organized bargaining power!) "share" their profits with workers. In this way, unions not only help in increasing real wages for workers but can control product markups and redistribute income away from profits to wages. The most recent business cycle and the weak relationship between tightening labour markets and (real) wage growth should lay to rest the belief and faith that the interactions between supply and demand are sufficient to increase workers’ living standards. This faith is misplaced because there is nothing "natural" about the market. What we call the market, particularly the relationship between workers and management, is not just a simple “exchange” relationship, like buying an apple from a store. It is a relationship infused by power and characterized by conflict. Employers want to pay the least possible; for workers, this means poorer living standards. Workers, on the other hand, want to earn as much as possible; this means (potentially) less profit for owners. In a situation such as this, characterized by opposing interests, conflict is the name of the game, and force decides. While tight labour markets are fundamental and beneficial to workers’ bargaining power, they are simply insufficient in their ability to provide workers with increasing real wages. Only organized bargaining power – in the form of unions – can do this. [KL1]In a particular industry OR In particular industries Figure II: Nominal versus Real Wage Growth, 2016-2018 [1] Non-management workers employed in the trades, natural resources, manufacturing and utilities. [2] NOC 5-7 [3] NOC 4-7 — Feb 1
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Health Care Workers Council Welcomes 120 New Members The Health Care Workers Council (HCWC) will soon be welcoming 120 new members as the result of successful organizing drives at two Alberta retirement homes. Workers at Chartwell St. Albert Retirement Residence, who work as LPNs, aides, dietary technicians, and more, received their union certification last month after overwhelming support for the organizing effort. Recent changes to the province’s labor code, instituted by Alberta Premier Rachel Notley and the NDP, allowed them to bypass a union election by collecting cards from more than 65 percent of the unit. Workers at another Chartwell residence in Sherwood Park, Alberta, did the same last week. Health care organizers The new members will join Local 1-207, which now has 11 health care units. Local 1-207 President Ray White credits the speed and success of both drives to the two organizers on the ground, both of whom are health care workers. “The difference between these two drives and ones in the past is that here the organizers were health care workers. Maybe they didn’t know as much about organizing as others, but they know the industry,” White said. “They speak health care. They know the acronyms,” said White. “They also know the issues facing people at work and can empathize because they’ve lived it.” Workers at both facilities intend to bargain to improve wages and working conditions, White said, particularly focusing on concerns over scheduling and seniority. Alberta law requires the two sides to meet within 30 days after the union certificate is issued. — Jan 14