Will Unions Get in the Way of Premium Pay?
Charles Cirtwill, Executive Vice President of the Atlantic Institute for Market Studies, spoke about the future of unions in a CBC National Radio interview in June 2009. In the conversation, he focused on the demographic shifts in Canada and in many other countries that will see labour shortages in the years ahead, and what those shifts may mean for unions.
“The fact is that this recession is probably the last warm-up round to what we are really going to see in terms of a significant demographic shift not only in Canada but around the globe. That demographic shift is going to put real pressure on unions and unionized workplaces because what’s going to happen is union membership is going to fall. The resources available to pay for unionized service, and that’s typically public sector unionized services, are essentially going to dry up. That is going to put pressure on union contracts, on unionization, on union membership that no one has ever seen. . .”
With power shifting from employers to individual workers, Cirtwell says, individuals will be able to negotiate better terms than if they were part of unions.
“In a period of labour surplus, the unions were a huge value add to the employee, to the individual worker. The unions were able to get benefits, to get a level of security in jobs, which an individual worker wouldn’t have been able to negotiate on their own. What is going to happen on the flip side as we move into a labour shortage is that the workers’ capacity to negotiate all those things is going to be that much stronger. In fact in many instances – and this is really going to take a leap of imagination for some people – the unions actually are going to become a barrier to individuals maximizing their returns from their skills and the scarcity of labour. As a result people are going to be, individuals, are going to be less inclined to support the unions.
“. . .I think the real impact on union numbers is going to be simple pure raw numbers. There are simply going to be fewer of them 15 or 20 years from now. They are probably still going to be paid a premium for doing those jobs, however in a time of labour shortage everyone is going to get that premium. In fact, union membership and the union contract may be a hindrance to getting a premium. In a labour shortage, people who work in high demand jobs can name their price and their perks. Being limited to the benefits outlined in a union contract will make it impossible to negotiate a better deal on your own. So I think in terms of raw numbers you are going to see a significant decline in union membership.”
Do you think unions will become increasingly irrelevant in the future?
For a transcript of this interview, email me: Alan [at] AlanMorantz.com
photo credit: Tertiary Education Union (NZTEU)