Canada criticized for economic costs of strong labour laws

[ganjavih]

Is this part of the reason building subways in Canada is so expensive?

Canada criticized for economic costs of strong labour laws

BERTRAND MAROTTE

Monday, September 25, 2006

MONTREAL — Canada's economy is paying a high price for labour laws in some of its jurisdictions that perpetuate coercive union power over employees, British economic adviser Len Shackleton says.

“Heavily unionized provinces show lower levels of employment and slower rates of growth,†Mr. Shackleton, dean of the Westminster Business School in London, said in an interview Monday.

Canada continues to favour union organization — often to the detriment of individual employee's rights — to a degree that is out of step with other countries such as Britain, Australia, New Zealand and the United States, Mr. Shackleton said.

Quebec, for example, bans strikebreakers as well as unionized employees from crossing picket lines during a labour dispute, he said.

“I think that Canada is now in some ways — certainly Quebec is in some ways — where the United Kingdom was in the late 1970s,†he said.

Mr. Shackleton cites the sweeping labour-law reform initiated in the early 1980s by then-prime minister Margaret Thatcher as a major contributing factor to Britain's transformation from Europe's “sick man†to the thriving economic power it is today.

The number of workdays lost to industrial labour disputes in Britain last year totalled 157,000, compared with a stunning 4.1 million in Canada, he said.

Union membership in Britain has fallen to less than seven million today from 13 million in 1979.

Quebec, Canada's most unionized province, accounted for almost 34 per cent of lost workdays in 2005, but has only 24 per cent of the work force, he added.

Quebec last year also had the largest share of strikes and lockouts — 55 per cent — said Mr. Shackleton, who began a four-day speaking tour of Canada yesterday as a guest of the Canadian LabourWatch Association, the National Citizens Coalition, the Montreal Economic Institute and the Fraser Institute.

Mr. Shackleton also said his fellow countryman, Allan Leighton, will have his hands full trying to turn around struggling Canadian supermarket giant Loblaw Cos. Ltd. “Retail is a difficult area,†Mr. Shackleton said.

Mr. Leighton, a veteran British manager known for being tough on unions, was recently named as deputy chairman at Toronto-based Loblaw just as it enters into contract talks with the United Food and Commercial Workers union in Ontario.

Loblaw needs to cut costs, and is looking for concessions from the union as it takes on growing competition from non-unionized rival Wal-Mart Canada Corp. of Mississauga.

As non-executive chairman of the Royal Mail in Britain, Mr. Leighton helped spur a turnaround three years ago that included job cuts.

But Mr. Shackleton said Mr. Leighton had a “kind of mixed record†at Royal Mail. “He did attempt a shakeup.†But it was not “entirely successful,†he said. “The Royal Mail i still a problem area.â€

© The Globe and Mail

 

[bizorky]

Re: Canada criticized for economic costs of strong labour la

We wouldn't want even a grain of social justice to get in the way of profits! No way.

I could probably do Shackelton's job for half of what he is being paid. I wonder if he would feel that, as such, he could no longer consider himself as being productive or competetive, and step out of the way? Somehow I doubt it.

 

[afransen TO]

Re: Canada criticized for economic costs of strong labour la

This argument isn't really about what 'should' be, but rather what 'is'. Societies that have less restrictive (but not nonexistent) labour laws tend to have better economic performance, and the kind of wealth that can let a society take care of the less fortunate.

 

[esplanade guy]

Labour conditions

That's complete crap. Countries with less restrictive labour laws usually have very poor people working hard, yet living in desperate conditions and very wealthy people living like Donald Trump. It's usually people at the top of the economic ladder making statements like that. These are usually the same people who go on and on about how they work hard and play hard. In any company, the lowest paid people always work the hardest.

 

[unimaginative2]

Re: Labour conditions

That's certainly not necessarily true. A CEO of a major corporation has an incredibly difficult, stressful job. In fact, it usually consumes their lives. The issue is that, while it's certainly reasonable to pay them quite a bit for doing that kind of job, it's clearly not reasonable to pay them a hundred times what the standard line worker earns.

The article is quite ridiculous. Obviously we'll attract more investment if we have no labour laws: look at China and Vietnam. The issue is that nobody but the richest 1% would want to live here if we did. Of course, they'd do very well with the extra-cheap labour, indentured servitude, and all...

 

[bizorky]

Re: Labour conditions

A CEO of a major corporation has an incredibly difficult, stressful job. In fact, it usually consumes their lives.

In some cases this may be true, but it does not match the situation for individuals who work low wage jobs, live near or in poverty, and simply have neither the time or resources to better their circumstances. These individuals outnumber the overworked CEO's by an order of magnitude - if not more.

When talk of economic efficiencies or productivity arise, it is usually at the expense of people. Human beings become just one more element for management or elimination in the name of efficiency or other such economic key words that come and go every ten years

 

[esplanade guy]

Working stiffs

I have worked for many different kinds of companies from the TD bank, downtown, to non profit companies, charitable organizations and government and I have never seen CEOs, managers and professional types work harder then the regular working stiffs. I worked in management in my last job at a huge company, in their main complex, with all the big, important bullshitters. Trust me, we had it VERY easy compared to the non-professionals working for this company. The company would endlessly go on about how everyone is equal but only management had access to all the perks, like paid lunches, 2 hour planning meeting with food, drinks and idol chit chat, free tickets to all kinds of events, parties with everything paid for.

There was one nice woman, who worked in a non-professional position, for over 20 years before retiring and the company wouldn't even pay for a small party. The employees had to pay for a pizza lunch for her but the uptight, bitchy PR lady got a full catered party, great food, free drinks, after only working for the company for 5 years, before she left for a better opprotunity, all paid by the company. When I asked my boss about it, I was told to mind my own business. We all know how the world works, get real. I did not stick around for more than a couple of years because the company was so full of shit. I can tell you from my experiences, working at mid-management, all the way down to entry level positions, the managers always had it really easy compared to the to those down the ladder.

 

[TdotTrickyRicky]

Re: Canada criticized for economic costs of strong labour la

I think it is difficult to compare how hard people work in jobs with different skill sets. Also, there is no strong correlation between hard work and pay. Some human skill sets are almost always worth more. For instance managing human capital or resources is almost always worth more then technical skill or knowledge in any field no matter how advanced.

I don't think unions are the boogyman but nor are they the social equalizers that they champion themselves. If you take the long view all they really do is delay inevitable structural changes in the work force and can even stiffle innovation in companies and personal growth in their membership.

 

[bizorky]

Re: Canada criticized for economic costs of strong labour la

^You raise some good points. I would agree that unions are not the great social equalizer that they champion themselves as being. However, from my own experiences I have seen very powerful unions (PSAC) incapable of affecting change for non-unionized workers who were forced to take pay cuts when their employer decided to do so. It was not because there was no will to do so on the part of the union, but because the employer held all the cards, and knew it.

Is there a need for structural changes in the workforce? Absolutely! However, one major problem is that the present "power structures" will be dictating the changes, not those at the bottom of the socio-economic or employment ladder. As a result, the changes made may only reflect the needs and interests of those instituting the changes. Labour tends to always to be in a postion of reaction - regardless of whether they are unionized or not.

 

[TdotTrickyRicky]

Re: Canada criticized for economic costs of strong labour la

The most influencial unions aren't those that look after the interests of those lowest on the social economic ladder. It is the middle-class unions that have the real power and influence although they at times dabble in recognition of those really living in dire straits.

I sympathize with the position unions take in wanting to hold the middle-class fort against assault from pure market forces. However, I think that the ranks of the middle class will thin in western countries and join the rest of the world (aka the real world) where income disparaty is much greater regardless of any union intervention. The next century will be dominated by one of the greatest increases in "middle-class" people in human history around the world, but these middle-class people are really only reaching a level of material affluence we associate with people still living below the poverty line. Similarly our middle-class will essentially keep spinning its wheels as they are placaded with cheap imported consumer goods while their real affluence is eroded. A good litmus test is teachers. Keep an eye out at how the relative affluence of say a couple where both parents are teachers falls with every passing year.

 

[EnviroTO]

Re: Canada criticized for economic costs of strong labour la

If the economy booms but leaves 2/3rds of the population behind is it really better than the economy not booming at all? At least with no boom the majority don't experience inflationary pressures on their budgets. I don't think total economic growth is as important as the growth in wealth the majority of the population actually experiences. A $5 million dollar raise for a CEO could be used as a $5000 raise for 1000 people and not have the impact of increasing the fiscal divide between rich and poor.

 

[spmarshall]

Re: Canada criticized for economic costs of strong labour la

And considering those 1000 people will be much more likely to spend that money locally than the CEO, then it becomes a much greater economic benefit as well.

 

[bizorky]

Re: Canada criticized for economic costs of strong labour la

A $5 million dollar raise for a CEO could be used as a $5000 raise for 1000 people and not have the impact of increasing the fiscal divide between rich and poor.

Then again, nor would the $5 million raise to the CEO. The number of CEO's who could gain such a raise are probably far fewer than one per thousand. As well, that five million could always go off shore, for tax purposes (as in not paying them).