Economic dividend symptomatic of state of public sector labour movement in BC

By Tara Ehrcke

With only a little bit of fanfare, the BC government announced last week that most of BC’s public sector workers would be receiving a surprise .45% pay increase next year under the “economic dividend” clause negotiated into most contracts.

Rallies are a start…but it will take defiant, united strike action to stop the incessant rollback on wages and benefits in the public sector.

Labour leaders rightly pointed out how meagre this .45% increase really is. CUPE BC Secretary-Treasurer Paul Faoro commented: “From 2002 – 2015 (the BC Liberal government’s time in office) the K-12 sector has had total wage increases of 13.2%. During that time, the rate of inflation was 20.1%, a differential of 6.9 percentage points.”

Yet there has been almost no discussion amongst BC labour about how we ended up here or what we will do about it. The “economic dividend” is deeply problematic on two levels.

Firstly, the fact that so many public sector unions agreed to this clause demonstrates the inability of the public sector to win pay increases that even match inflation. They agreed to include this clause out of desperation, to have something in a contract that otherwise represents a pay cut. And as even labour leaders admit, BC’s public sector workers have by and large seen their wages diminish relative to inflation over the last fifteen years. It is wage rollbacks by a thousand cuts.

Secondly, the economic dividend should have been rejected by every public sector union on ideological grounds. The dividend ties wage increases to increases in the provincial GDP that exceed the forecast. This institutionalizes two concepts. First, that workers don’t get their share of ALL the economic growth, but rather only the “extra” growth beyond government forecasts. In other words, workers don’t get their share of standard or expected growth levels, which are almost always accompanied by inflation. More insidiously, tying wage increases to GDP growth invites workers to buy into neoliberal dogma that any government policy designed to increase that growth is necessarily a good thing. This is particularly troubling coming from a government whose primary election platform was growth through massive Liquified Natural Gas development. The unstated message is that all workers need to support resource extraction because that is the only ticket to wage growth. In other words, there is a built in incentive in our collective agreements to support resource based economic expansion. This has the potential to further divide the labour movement over environmental issues.

Sadly, most unions accepted this clause because they saw no other way of getting wage increases, or even of maintaining wages versus inflation. But capitulating to the BC Liberals is no answer.

Fifteen years of falling wages in the public sector should instead be a wake up call on the need for genuine solidarity and action in the public sector. We’ve been through the contract stripping of the early Campbell years, the “net zero” mandate post recession, the “cooperative gains” initiative where we stole from ourselves, and now we are accepting measly increases (going backwards more slowly) only when government does better than it expected. These are a recipe to slowly losing everything we ever gained.

Instead, public sector workers need to seriously rethink and reevaluate our strategies. Clearly, we need to be united in action and be willing to fight if we are to push back this tide. We need to be willing to face fines, threats, legislation. Because if we don’t, we can only expect more of the same.

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