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Strained Labour Relations: Industrial Relations Outlook 2014

It’s a tense time for labour relations in Canada, and more than half a million public sector workers will be involved in collective bargaining this year. These factors could lead to contentious negotiations between governments and their employees. The “tone” of negotiations may be more negative—and unions less willing to compromise.


Canada Post: The Option of Privatization

The dramatic changes to mail service and stamp prices announced in December were intended to put Canada Post back on track—toward a sustainable and profitable business. When The Conference Board of Canada first published a report on the future of postal service in Canada in April 2013, the outlook was grim. The report projected that if nothing changed, Canada Post would face operating deficits of about a $1 billion a year by 2020.

A Stronger 2014: Provincial Outlook

A two-tiered economy in Canada in recent years has seen resource-rich Saskatchewan, Alberta, and Newfoundland and Labrador outperform the rest of the country. Things are looking better for other provinces in 2014 with the prospect of a stronger U.S. economy helping to boost exports.

Barriers at Work for Young Women

Canadian organizations are—unintentionally—underestimating young women as being too young, or not ready, to assume increasingly challenging leadership roles. Women are therefore lowering their career expectations, at a cost to both their own advancement and to the success of their organizations. Organizations need to implement objective and transparent talent management practices that guard against this “unconscious bias.”

Strengthening Canada’s Commercial Fisheries and Aquaculture

Canada's commercial fisheries, aquaculture, and processing industries could build on what is already a $7-billion a year business. The key is targeting the rising global demand for fish and seafood. To capitalize on growing markets abroad, the industry first needs to overcome its own fragmentation and uncertainty.

The Future of Retail, Wholesale, and Transportation: Canadian Industrial Profiles

Retail sales are expected to grow in 2014, and that will improve the overall outlook for the wholesale sector. Competition from new American retailers in the Canadian market, however, will suppress retailers’ and wholesalers’ overall pricing power and profits. In the end, consumers will benefit. On the transportation, warehousing, and logistic side, the trade of bulky mining, forestry, and agriculture products will result in higher demand for rail, ship, and terminal services in 2014.

CBoC Highlights

Photo of the Hon. Jason T. Kenney Photo of Vijay Gill

David Stewart-Patterson, Vice-President of Public Policy, discussed Canada Post’s announcement to end door-to-door urban delivery on CBC’s Ontario Today.

Ruth Wright, Director, Leadership and Human Resources Research, described generational differences in the workplace.

In This Issue

  • Strained Labour Relations: Industrial Relations Outlook 2014
  • Canada Post: The Option of Privatization
  • A Stronger 2014: Provincial Outlook
  • Barriers at Work for Young Women
  • Strengthening Canada’s Commercial Fisheries and Aquaculture
  • The Future of Retail, Wholesale, and Transportation: Canadian Industrial Profiles

Previous Issues


Canada’s Food Industry 2018-19: A Plate That’s Full
May 29 at 2:00 PM

Latest Blogs

Where Have All the Workers Gone?

Jun 06, 2018
Kip Beckman
Principal Economist
World Outlook

President Trump constantly reminds us that the economy is booming under his watch due to increased business confidence, the tax cuts implemented at the end of last year, and the injection of fiscal stimulus over the winter. While the stimulus may not enable the economy to expand by the 4.0 per cent that the President felt was possible during the election campaign, we do expect real GDP growth to approach the 3.0 per cent range this year.

A number of events, however, could derail economic momentum, including geopolitical tensions in the Middle East and elsewhere, and the danger of the Fed tightening monetary conditions too quickly. But possibly the greatest risk to the outlook is rapidly developing labour shortages. If firms can’t find the workers to run their operations, the economic expansion could grind to a halt.

The economy is currently in its ninth year of expansion, the second longest run in history. The unemployment rate recently dropped below 4.0 per cent, a level generally attained in the past in times of conflict. During the Second World War, the Vietnam War and the Korean War, millions of soldiers were sent abroad, which depleted the labour force and sent the unemployment rate tumbling. Today’s plunging unemployment rate is a result of a combination of three factors: fiscal stimulus, social developments, and an aging population. In the past, the return of troops following the end of overseas conflicts eased some of the pressure on the labour market in the United States, but that won’t happen this time around.

There is little doubt that labour shortages are quickly becoming a reality for many U.S. firms. Currently, there are more than 6 million job openings—a record high—and two underemployed workers for every open position. In comparison, at the height of the financial crisis in 2008–09, there were close to 12 underemployed for every job opening. The National Federation of Independent Business recently reported that about one-third of small businesses have posted job openings—a development that hasn’t happened since the tech boom in the late 1990s.

Tightening labour markets are finally translating into wage gains, something that has been absent since 2009 when the economy started to slowly recover from the severe recession. Wages are currently expanding in the 3.0 per cent range, close to double the pace that transpired after the recession. While this is below the 4.0 per cent gains recorded in the 1990s, the last time the unemployment rate was below 4.0 per cent, wages were at least increasing at a pace above the inflation rate of roughly 2.0–2.5 per cent.

In general, a combination of record job openings and rising wages will entice additional workers to join the workforce, thus easing labour shortages. However, several barriers will prevent this from happening. The opioid crisis has received lots of media attention recently and remains one of the most troubling social developments in the U.S. and elsewhere. According to Moody’s Analytics, close to 50 per cent of men of prime age who aren’t in the labour force take pain medication daily, mainly via prescriptions. Opioid-related deaths are the main reason that the Census Bureau has over-estimated U.S. population growth recently. There are also a considerable number of prime-age workers either on disability, in prison facilities, or unable to find employment due to previous periods of incarceration. Around one-tenth of the labour force is currently dealing with these serious problems.

Prime-age participation in the labour force has also been hurt by inadequate family and medical leave policies present in many U.S. firms. These policies, which are far more prevalent in countries like Canada, permit employees to receive income while on leave for medical emergencies or other family issues like the birth or adoption of a child. With millennials starting families, the need for these programs in increasing in importance.

Finally, the greatest impediment to adding more people to the workforce is the Trump Administration’s tough stance on immigrants. Nearly one million legal and undocumented people have been coming to the U.S. annually for the past few years—a number that has accounted for most of the growth in the working-age population. Obviously, a slowdown in immigration will exacerbate the difficulties that some organizations have encountered in finding workers.

Moody’s Analytics also notes that the Trump Administration’s policies would be appropriate if the economy was weak, had a sharply higher unemployment rate, and exhibited a great deal of slack in the labour market. But, with an unemployment rate about as low as it can get and the supply of labour diminishing, ramping up economic stimulus while at the same time restricting immigration doesn’t make much sense. The end result could be higher inflation and interest rates than currently anticipated. In fact, the poor policy mix is one of the factors behind our view that U.S. economic growth will slow down beyond 2018.


Zandi, Mark. “U.S. Macro Outlook: A Binding Constraint on Growth,” Moody’s Analytics, May 14, 2018. Accessed May 20, 2018.