Conference Board predicts labour peace

‘Neither side will have the upper hand’
By Gordon Sova
|hrreporter.com|Last Updated: 05/01/2009

OC Transpo riders and York University undergrads might not agree, but the theory and the evidence both support the Conference Board’s conclusions. Unlike in past recessions, neither management nor unions have many chips to play, and both will tend to behave and react rationally this year.

No one will have any interest in strikes or lock-outs in 2009, the Board’s Industrial Relations Outlook, 2009 concludes. Of the organizations surveyed for last fall’s Compensation Planning Outlook, well before the current round of closures and layoffs, 86 per cent stated a work stoppage “will not” or “definitely will not” take place this year in their workplace. There is no indication that this number has dropped.

This is a marked change from previous recessions when management used high unemployment to force concessions from unions. These cycles were also marked by more time lost to strikes and lock-outs.

The Outlook is the product of a roundtable involving six participants: three national union figures, one government official and two business representatives.

CLV Reports has begun to see numerous wage freezes in manufacturing agreements, a harbinger we have been looking for since the first bad news began to circulate. Many of these agreements are being achieved early, and they are being ratified by close to unanimous votes. There is no stomach for strikes.

Union negotiators and, to a lesser extent, their management colleagues are left with two problems. First, they need to be able to reduce the expectations of their members. Second, they need to focus the attention of the members on other issues on which progress can be made. This may be in pensions or job security for unions, or in productivity and flexibility for management.

Because trying to make wage increase predictions is like shooting at a moving target, CLV Reports did not publish our annual predictions last fall. The Conference Board now forecasts a 2.6 per cent increase across the public sector, down from the previous forecast of 3.5 per cent, and 2.9 per cent in the private sector, down from 3.2 per cent.

The Industrial Relations Outlook finds that, in the public sector, and with the notable exception of health care, the prospect of deficits and the massive spending planned for infrastructure will serve to lower wage increases. In the private sector, both manufacturing and mining have seen the demand for their products drop. With so many companies in poor financial shape, union members are aware that there is little money for wage increases. Management, however, has no wish to risk a strike, either, if the loss of production might push the company over the edge.