Kevin Carmichael: Persistent labour shortages may prove a bittersweet victory for workers
Record job vacancies show labour is about to take its revenge. Victory might be bittersweet.
For three decades, owners and bosses mostly have had it their way. Wages and salaries peaked at about 50 per cent of Canada’s gross domestic product in the 1970s. They generally have declined ever since, dipping to 42.4 per cent in the second quarter, the lowest since 2005, according to Statistics Canada.
Those changes were good for profits, but they were also good for prices — after surging to double digits in the 1970s, inflation has been stable around two per cent since the early 1990s. We started buying more goods and services than ever. Household consumption consistently represented about 50 per cent of GDP until the mid-2000s, and then it broke higher. Household consumption expenditure was 57 per cent of GDP in the second quarter, the most on records that date to 1961, according to Statistics Canada.
Whether all of this was good for society is open for debate. Considerable evidence suggests the balance may have tilted too far in the favour of bosses, a group of digitally native entrepreneurs who found themselves in the right place at the right time, and anyone who happened to own property in big cities circa 2010. Income and wealth inequality widened as manufacturing employment declined, fuelling the resentment that characterizes contemporary politics; household debt surged, as many of us turned to credit to maintain a certain standard of living; and many North American communities are gripped by an opioid epidemic that is killing more than 20 Canadians per day, compared with eight per day in 2016, according to the Public Health Agency of Canada.