Northern Exposure

Wage Settlements Across Canada Slow Down — More in Private Sector

Human Resources Development Canada (HRDC) reports that wage settlements in unionized companies this year (January to August 2009) have averaged 2.4 percent. The results are based on 237 agreements covering 632,000 employees. Wage adjustments are averaging 2.5 percent in the public sector and 1.9 percent in the private sector.  See www.hrsdc.gc.ca/eng/labour/labour_relations/info_analysis.

The spread between public- and private-sector settlements seems to be even larger in the last three reported months, as shown in the following table from HRDC.

  • June  2009 – Public Sector  3.0: Private Sector  1.6
  • July  2009 – Public Sector  2.1: Private Sector  1.2
  • August 2009 – Public Sector  3.4: Private Sector  2.1

This continues historical trends, when public-sector wage adjustments generally remain higher than those in the private sector during economic downturns. This is one area where the lack of a “bottom-line discipline” or any need to face one’s bankers seems to have an impact on public-sector spending decisions.

Contact the author, Brian Smeenk