August 24, 2010
Economic Snapshot
Wage settlements in public sector continue to outpace private sector
JOHN CLINKARD
consulting economist, CanaData
According to the Ontario Collective Bargaining Review, 2,025 collective agreements were negotiated in 2009.
These involved approximately 36% — or 592,400 — of the province’s unionized employees.
While just over half the contracts negotiated in 2009 were in the public sector, they involved almost 75% of all employees.
For all agreements, the average annual wage increase was 2.1%, down from 2.7% in 2008 and 3.0% in 2007.
In 2009, the consumer price index in Ontario increased by 0.4%, compared to 2.3% in 2008 and 1.8% in 2007.
As has been the case in eight of the past 10 years, the size of wage settlements in the public sector was larger than in the private sector.
In 2009 they averaged 2.4%, compared to 1.3% achieved in the private sector.
It is worth noting that 36.4% of all private sector employees (58,300) covered by labour contracts ratified in 2009 received no increase in base-wage rates, compared to 0.2% (8,644) in the public sector.
At the same time, approximately 6% of private sector employees received increases in base-wage rates, ranging from 3% to 3.9%, compared to 2.4% in the public sector.
Wage settlements in manufacturing, which involved 67,394 employees, averaged 0.7% in 2009.
In non-manufacturing, which accounted for 88% of the contracts negotiated, wage settlements averaged 2.3%.
The bargaining calendar for Ontario’s construction industry was light in 2009. During the year, 181 contracts were ratified, which increased the base wage rate of the 3,407 employees involved by an average of 2.5%.
Following a lean year in 2009, 794 construction contracts are up for renewal in 2010. These involve 120,000 employees, the largest number since 2004.
Year to date (May), 33 construction contracts have been ratified involving 43,160 employees.
Settlements, year to date, provide average annual increases ranging from 2% to 3.2%, and averaging 2.5% over the life of the contract.
John Clinkard has over 30 years’ experience as an economist in international, national and regional research and analysis with leading financial institutions and media outlets in Canada.
Data source: Ontario Ministry of Labour
Chart: Reed Construction Data – CanaData.
