Fearful Symmetry - the Fall and Rise of Canada's Founding Values. Brian Lee Crowley
fact, population aging is likely responsible for the fact that unemployment in this downturn is actually quite mild compared to earlier recessions at the height of the Boomer wave. The unemployment rate in mid-March 2009 was 7.7 per cent. To put that in perspective, the unemployment rate for the quarter century from 1974 to 1999 was always higher (8.1 per cent in 1990 was the lowest during the period). Moreover, during a similar worldwide recession in the early 1980s, the Canadian unemployment rate was in double digits for four years (1982, 1983, 1984, and 1985), peaking in 1983 at 12.7 per cent. We haven’t seen double-digit unemployment since 1994 (10.4 per cent).25
Prime Minister Stephen Harper has been quite forthright about the fact that the current downturn is merely masking a much more profound social transformation. In a speech in London, Ontario, on March 13, 2009, he said, “As the world struggles with the effects of global recession, we as Canadians are looking ahead. Despite the rising unemployment we see today, the demographic reality is this: as soon as this global recession ends, our country will face a long-run challenge of labour shortage.”26 Many others have made the same point, including those responsible for the Atlantic fishery, traditionally the employer of last resort in the highest unemployment region of the country.27
If we really want to see what the future has in store for us, we have to look back to conditions just before the downturn. We do not have to wait until 2016 to see how Canada will be changed by our new population circumstances, because those circumstances have already begun to make themselves felt, even if the change is being masked for a brief moment by the downturn.
Perhaps the newspaper reports28 a couple of years ago of a proposal to build a new pipeline in Alberta did not catch your eye. After all, what is there new about another pipeline in Alberta? Nothing. Or at least so it appears until you realize that this pipeline is not to take oil or gas out, but to pipe a very light oil (“diluent”) in. The purpose? To dilute the heavy oil extracted from the oil sands to allow it to be piped out to places where the labour force is available to build and operate the plants needed to process it. Even in this lull in Alberta’s super-powered growth, oil sands giant Syncrude is having difficulties recruiting the workers that it needs and was on a major recruiting drive in Atlantic Canada in February 2009.29 And even though unemployment has undeniably risen in Alberta, that province, along with Saskatchewan and Manitoba, continues to have the lowest unemployment rate in the country.30
In Brandon, Manitoba, in order to get the workers needed to operate its meat-packing plant for several shifts a day, Maple Leaf Foods imported workers from Mexico and Colombia, to whom the winters must have seemed a rude shock. In PEI, there were dozens of Russian guest workers at a fish processing plant, and there were requests for more. There is now discussion about closing down fish plants for want of workers, a trend that is set to accelerate. On current demographic trends, unemployment in Nova Scotia will, in a few short years, have fallen to 3 per cent, regardless of the recession of 2009–10.31 In response to requests from businesses across the region, every provincial government in Atlantic Canada now has an immigration policy. Under federal-provincial nominee programs in virtually every part of the country, needed workers can be fast-tracked.
Until 2008 I was a partner in a restaurant in Halifax, and our biggest single challenge, bar none, was to find the workers we needed, an experience common to every other restaurant owner we knew. The Canadian Restaurant and Food Association projects huge labour shortages throughout the industry in the years ahead, again despite the gloom of 2009.32 It is an industry, like many other services, that cannot be outsourced or offshored to China or India, but must be done by people right here in Canada.
The average truck driver in Canada falls into the 50- to 55-year-old range (and is as old as 70 in some regions)33 and everyone is increasingly concerned that we will not be able to bring needed goods to consumers because we won’t have the people to drive the trucks to get them where they need to go. Try to imagine an economy in which it has become impossible to move goods from factories and ports to stores and homes.
As you can see, there is no need to wait until 2016 (when the growth in the number of new workers goes to zero) to feel the effects of a tightening supply of workers. Those effects are already here, and they have already affected growth, mobility, wages, and investment. According to a 2006 PricewaterhouseCoopers survey, nearly two-thirds of Canadian private companies said that the shortage of skilled workers was already slowing the growth of their companies.34 In Ontario, where the economy has been battered recently, nearly 57 per cent of business leaders polled that same year, a strong majority, reported that their growth was hampered by labour shortages.35 And according to the Canadian Federation of Independent Business (CFIB), nearly 60 per cent of their members were expressly mentioning labour shortages as an issue of importance to their business.36
And among specific industries, the CFIB’s numbers were even higher. The momentum behind labour shortages has been growing across many sectors, including manufacturing, for several years, and now includes shortages of unskilled as well as skilled workers. A year or two’s increase in cyclical unemployment will not change anything about this portrait of profound long-term change.
Most new workers entering the labour market will be absorbed simply to fill the jobs about to be vacated by retirements, as opposed to creating opportunities for new growth.
We don’t have much time to prepare.
How the Future Will Differ from the Past
Can this really be Canada, where not so many years ago a party won one of the biggest parliamentary majorities in history on the slogan “Jobs, jobs, jobs”?
Yes, because that was then and this is now. When Brian Mulroney and his Tories swept to power in 1984, it was the year that, on David Foot’s account, the last members of the Boomer generation (those born in 1966) turned eighteen and began looking for work. The entire Boomer generation was now in the workforce or was at least of working age.
Alongside that population change came huge political change, particularly in Quebec–Canada relations; this book describes how these two forces combined to produce many of the vast changes Canada has undergone in recent decades. The Quebec state, for example, was at the early stages of its efforts to prise open the province’s private economy for French-speakers. That effort, combined with decades of bad policy in the province (which I describe in detail in Chapters 3 and 7) had undermined growth. Meanwhile, the patriation of the Constitution over Quebec’s objections in 1982 had given the nationalist movement a new grievance with which to excoriate all things Canadian. The competition between Ottawa and Quebec City for the loyalty of Quebeckers drove a vast growth in the size of the state at all levels in Canada.
Today, while the problem of Quebec nationalism remains unresolved, one of its main props, the federal-provincial battle over the Boomers and their place in the economy, is about to enter a quite different phase.
Again we must not allow the temporary circumstances of the downturn of 2009 to obscure the long-term trends. Whether growth returns in 2009, 2010, or 2011, while it matters enormously to us in those years, is only a question of timing. The labour shortages that were so evident in 2006 to 2008 will return because they are driven by deep forces that transcend economic cycles. Unemployment before 2009 was rapidly becoming yesterday’s issue, and the pace of that change will accelerate when today’s downturn is only a fading memory. When that happens, plant closures and mortgage defaults will disappear from the headlines, and we will again find that newspaper accounts of labour shortages jostle for space with stories about declining student numbers in the public schools. As a legacy of the last half century’s political battles, however, we will still find ourselves lumbered with a series of policies designed to mop up surplus labour at a time when we will need to ferret out every worker we can find. For example, the EI system still pays people not to work for long periods of the year, especially in seasonal industries, and thanks to the miracle of regionally extended benefits, pays them extra to move to areas of high unemployment, rather than paying them to move to places where the jobs are. It also discourages education, because students are not eligible for EI. The number of teachers in the public schools rises as student numbers fall. The part of the economy where employment is growing the fastest by some measures is still the public sector, and the pace is picking up, driven in part