A two-day recruiting drive in early 1995 saw more than 25,000 applicants queue up in frigid January weather to put their names in contention for future production jobs at GM Canada’s Oshawa campus. Parka-clad job seekers stood in line between snowbanks, lit barrel fires to keep warm and caused backups on Highway 401 for a shot at job postings paying $22 an hour, according to contemporary press reports.
Nearly 30 years later, as the latest round of contract talks between the Detroit Three and Unifor head down the stretch, such a scene is nearly unimaginable, with the quality of auto assembly jobs among the key reasons, labour experts say.
The trade-off for young workers weighing a job at a Canadian auto plant “isn’t as great as it used to be,” said Stephanie Ross, an associate professor of labour studies at McMaster University in Hamilton, Ont.
“It used to be that these were jobs that you could have a life based on. You could have a whole long-term future. You could buy a house.”
Adjusting for inflation, the $22 per hour that applicants were offered in 1995 translates into $39.57 an hour today, according to the Bank of Canada inflation calculator.
But in unadjusted, nominal dollars, starting wages at Detroit Three plants in Canada have only crept forward by the slimmest of margins over the past 28 years.
Under Unifor’s 2020 collective agreements with GM, Ford Motor Co. of Canada and Stellantis, new staff start at $24.26 per hour, 65 per cent of the top-end hourly wage of $37.33, which takes eight years to reach.
“They are not going to be able to draw in the kind of work force they want unless they really change the economic deal,” Ross said.
STARTING WAGES MIGHT NOT ‘CLEAR THE MARKET’
Available jobs at Canadian assembly plants used to prompt scenes such as the one east of Toronto in 1995, said Brendan Sweeney, managing director of the Trillium Network for Advanced Manufacturing. Today, with “now hiring” banners adorning the sides of some Ontario assembly plants and job advertisements running in food courts at local malls, it’s questionable whether the starting wages being paid by the Detroit Three “clear the market,” he said.
“The jury’s out now on whether what the automakers are paying is really getting them the quality and quantity of employees that they are used to. It certainly doesn’t do what it used to.”
But Stellantis, for one, said it is not having trouble attracting and retaining production workers at its Canadian plants.
The company “remains a desirable place to work,” company spokesperson LouAnn Gosselin wrote in an email to Automotive News Canada.
As the automaker gears up to hire 3,000-plus workers to fill the manufacturing jobs it plans to create in Canada over the next few years, it is working with local colleges and universities to “ensure we have graduates in the pipeline,” she said.
GM Canada and Ford Canada did not respond to multiple requests for comment.
ADVANTAGE, UNIFOR?
While the purchasing power of Canadian autoworkers’ wages has eroded since the 1990s, both Ross and Sweeney see 2023 bargaining as an opportunity for a course correction.
Record profits at the auto companies and the recent groundswell of public support for workers over corporations have greatly strengthened Unifor’s hand, Ross said.
The conditions for significant wage gains and improvements to collective agreements “are the best they have been for decades,” she said, “backed up by the realistic threat of strikes.” The automakers also signaled early willingness to reward employees for their contributions as talks got under way in August, Ross said.
The union’s contracts with the Detroit Three expires Sept 18.
Given the current climate, Sweeney sees gains across automaker wage grids in this year’s talks as a “foregone conclusion,” though exactly what form they will take is unclear. One scenario, he said, would concentrate those gains at the low end of the wage grid, setting up a potential “win-win” for both parties.
For the union, higher pay for new members would illustrate the value of Unifor representation to younger workers as the union prepares to organize new battery supply-chain plants in Canada. And while automakers would be on the hook for higher expenses, they could also gain back the wage premium that used to guarantee them the cream of the employment crop, Sweeney said.
“If the wage improves, they’ll have access to a larger and more highly qualified pool of new people that will be part of the renewal of the industry and the shift to electrification,” he said.
‘POTENTIALLY A WIN-WIN’
Sweeney expects that substantially higher starting wages as well as a compression of the wage grid, which currently takes eight years to climb, will be on the table during this round of bargaining.
Ross also sees the chance of a mutually beneficial deal.
“It is potentially a win-win, if the companies can think in that long-term way rather than putting short-term profits and stock prices as the main data point for making their decision,” she said.
In addition, Unifor must see this year’s talks as an opportunity to bridge the gap between new and longtime members who work the same jobs under separate employment conditions, Ross said.
Along with significant separation between starting and top-end wages, new workers pay into defined-contribution pension plans, while longtime workers have defined-benefit pensions, which are generally seen as superior, Ross said.
These divisions between new and veteran workers, she added, are “very corrosive to union solidarity.” So far, Unifor has not publicly disclosed its wage expectations or its other demands of the Detroit Three during this year’s talks, but President Lana Payne said the union’s priorities will focus on all groups of autoworkers, new, active and retired.
“With respect to our members with low seniority, and future hires, we certainly see an opportunity to reduce the wage progression for members in the New Hire Program,” Payne wrote in an emailed statement.
As of press time, Unifor’s negotiations centred on Ford Canada.
