The hubris that comes from winning a second majority government prompted Ontario Premier Doug Ford’s Progressive Conservatives to bring forward legislation pre-emptively banning education workers from striking. For good measure, Bill 28 invoked the notwithstanding clause.
The legislation was so offensive that it united private-sector unions with their public-sector counterparts in supporting a strike of defiance by the Canadian Union of Public Employees.
With an Abacus poll showing six in 10 Ontarians blaming the government rather than the union for the strike, Mr. Ford caved, offering to rescind the legislation Monday if CUPE workers would please, please, please go back to work. CUPE, victorious, ended the strike.
(Abacus polled 1,000 Ontario random panelists on Nov. 4-5, with a comparable margin of error of 3.1 per cent, 19 times out of 20.)
The climbdown is a well-deserved rebuke for Mr. Ford. No government should impose a contract on a union in advance of a possible strike. Such legislation renders collective bargaining meaningless.
But a larger issue is at play. Canada’s labour force is growing very slowly, if at all. (Statistics Canada reported an uptick in the size of the labour market in October, after several months of contraction.)
With the baby boomers at or very close to retirement age, there could soon be fewer people entering the labour force than there are leaving it.
That means fewer teachers and education workers available to meet demand, fewer nurses and doctors, fewer support staff at long-term care facilities, fewer retail and restaurant workers, fewer people available to harvest crops or drive trucks or work on the line or do just about anything else.
In response, the federal government has embraced record levels of immigration, with 500,000 new Canadians slated to arrive in 2025. But immigration can only soften the impact of a labour shortage; it can’t reverse it.
With more jobs available than workers to fill them, those workers will naturally seek wage increases. Some employers will agree; others will focus on increasing automation.
Have you noticed the increase in self-checkout locations in stores? How often now do you order and pay for a meal using your smartphone? Next up: self-driving taxis.
But the public sector resists innovation and will be slow to automate. Public-sector unions tend to be much stronger than their private-sector counterparts. In the years ahead, wage gains in the public sector will likely outstrip those in the private sector.
Furthermore, as Mr. Ford has demonstrated, governments that find themselves in a politically unpopular labour dispute can escape by surrendering to wage demands.
If public-sector workers in essential occupations do strike, governments can end the strike with back-to-work legislation (which is the course Mr. Ford should have chosen). Such legislation often sends the dispute to arbitration for settlement, resulting in at least a partial victory for the union.
There are limits. Higher public-sector wages are paid for through higher taxes, which taxpayers resent. Eventually, governments receive a public mandate to cap public-sector wage increases. This happened federally and provincially in the 1990s, after several decades of public-sector wage gains.
And as the labour force shrinks in the years ahead, the size of the economy will shrink as well. Artificial intelligence may one day control automobiles, but AI never needs to buy a refrigerator or a new dress. Consumption drives economic growth; fewer consumers means a smaller economy.
All well and good, you might say. We need to break the cycle of endless growth and learn to consume less. But a shrunken economy results in a shrunken tax base. That means even longer wait times in emergency wards, even larger classroom sizes, more potholed roads, fewer buses.
There is no easily predictable outcome to any of this. But certain projections seem reasonable. With employers competing for workers, those workers will demand greater flexibility, increased job satisfaction and higher wages. Employers will seek to satisfy those demands, while also increasing automation. Public-sector employers will do everything more slowly than the private sector, and face greater wage pressure from public-sector unions. Eventually, declining tax revenues and fed-up taxpayers will force a cap on public-sector salaries.
But as Doug Ford learned to his sorrow, if you try to bring the hammer down too soon, you’re likely to hit your own thumb.