If Workers Can’t Make Gains During A Boom Like This, When Can They?
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Some Boom – Wages Up a Measly 1.4%
The first issue of a new quarterly publication from the Alberta Federation of Labour finds that weekly wages in Alberta are only up 1.4% in 2006, after accounting for inflation. The AFL launched Labour Economic Monitor today, which will track economic indicators and trends in Alberta.
“Everywhere we turn, we are told the boom is causing a spike in wages across Alberta. Business is complaining about the rising cost of labour,” says AFL President Gil McGowan. “Yet, the statistics don’t seem to be backing that complaint. On average, workers’ wages are increasing only slightly ahead of inflation.”
According to wage figures from Statistics Canada, in the first quarter of 2006, weekly earnings were up 4.9% over the first quarter of 2005. However, inflation in Alberta is running at 3.5%, meaning that workers are only seeing a 1.4% increase in their real wages. Weekly earnings measures how much a worker takes home at the end of a work week – not how much they are paid for each hour of work.
“Alberta workers have had stagnant wages for the better part of 15 years – all through the 1990s and early 2000s,” observes McGowan. “And now at the height of the boom, we would expect workers to catch up a little bit, take advantage of the prosperity through larger wage increases.”
“Quite frankly, it is not happening yet. Wages are going up but the increases are being eaten up by inflation.”
McGowan says that real wage increases are good news, not bad: “If workers can’t make gains during a boom like this, when can they?”
He also argues that rising wages aren’t the cause of Alberta’s inflation: “Alberta has had higher inflation than the rest of Canada for much of the last decade. But if, as economists argue, non-inflationary wage increases must be based on rising productivity, Alberta is a place were we should see such increases. According to the latest figures from Statistics Canada, Provincial GDP increased by 15% last year. So lot’s of wealth is being created, and only a small portion of it is going to working Albertans.”
The AFL’s new Labour Economic Monitor is intended to offer workers and average Albertans up-to-date economic information and analysis. It will be released quarterly on the AFL website. The first issue can be read at www.afl.org.
“The government and large corporations have access to the most up-to-date data about Alberta’s economy to help them make decisions. Until now, working families have had no such information. Labour Economic Monitor is designed for them – to give them some of the same information that their employers have,” says McGowan.
“The AFL wants Alberta workers to receive their fair share of our prosperity. It is long overdue.” McGowan concludes.
@ July 17, 2006