FROLITICKS

Satirical commentary on Canadian and American current political issues

Oct 27

Women Still Cannot Break Corporate Glass Ceilings

by bcurry

Yes it takes time for more women to reach leadership positions in companies, even though more and more qualified women are entering business management fields.  One human resource expert in 2011 referred to the so-called infamous glass ceiling as being more of a brick ceiling.  Yes, there are more women in senior management than ever before.  However, proportionately, they still are under-represented as to their numbers in businesses in general.  Back in 2020, Bloomberg News reported that women held more than a quarter of the board seats at S&P 500 companies for the first time, a significant gain.  It was also reported at the time that, according to Catalyst which follows labour market trends, there now were 32 women leading S&P 500 companies.  Increasingly although at a snail’s pace, more women are now holding the top finance jobs (e.g. Chief Financial Officers) at large U.S. companies, despite the fact that companies continue to have fewer women in operational roles.

What is disheartening in 2022, Bloomberg News reports that women are leaving the top ranks of companies at higher rates than ever before — as female employees remain less likely to get promoted into leadership roles in the first place.  According to a new McKinsey & Co. and LeanIn.org report, for every woman at the director level who gets promoted, two female directors are choosing to leave their company.  Bloomberg notes that while women have long been at a disadvantage in the workplace, many of problems have been further exacerbated by the COVID-19 pandemic.  For example, a lack of affordable childcare has contributed to more women leaving the workforce than men in recent years.  A gender pay gap, which had been narrowing, also stalled during the pandemic.  Furthermore, those in the highest ranks of their organizations are re-evaluating — because of a lack of advancement opportunities, flexibility or unequal treatment or a combination of these and other factors.  Many of the factors were once again particularly true for women representing visible minority groups, such as women of colour.  Women of colour continue to represent far fewer women promoted to a manager role from entry-level when compared to women in general.  This is further complicated by the fact that there are still simply fewer women in upper management at most companies to be promoted.

McKinsey and LeanIn reported also that the pandemic affected women in other ways, in particular those related to remote work and work-life balance, especially where children are involved.  They found that only one in ten female employees want to work from the office most of the time.  The summary of their report said “many” women call hybrid work schedules a key reason for joining or sticking with an employer.  LeanIn CEO Rachel Thomas points out that: “Women are not breaking up with work, they are breaking up with companies who are not delivering the work culture and the opportunity and the flexibility that’s so critically important to them”.

Women have made some strides to break the glass ceiling in recent years.  According to a 2014 report by Reuters, for the first time more than half of 4,000 corporations worldwide reported boards with 10 percent or more female members.  However, it is noted that for all the progress that’s been made, male CEOs and board members still vastly outnumber women. 

All in all, it appears that the pandemic has stalled the steady progression which promoted more and more qualified women to senior management and corporate board positions.  Most governments in the U.S. and Canada have made it clear that the current situation is still unacceptable.  At all levels of government, most have promoted women to leadership and judicial positions, cabinet portfolios, and have attempted to encourage more women to run for political office.  On the other hand, as one author noted, the inability to recruit and retain women in the corporate arena could be disastrous for businesses.  This is not hyperbole, especially when women now make up the majority of university grads and most plan to enter the labour force upon graduation.  Yes, frustration has set in and rightly so.  Paying lip service and tokenism are no longer an option!  At this time, what one has is only a crack in the glass ceiling!

Canada Labor Force Labour Force US Women's Issues Women's Issues

Leave a comment »
Oct 20

Elder Poverty Is Growing In Both The U.S. And Canada

by bcurry

Employer pensions are not what they used to be.  An analysis done back in 2016  found that just 99, or about 20%, of Fortune 500 companies offered a “defined benefit plan” to new salaried employees in 2015.  This was down from 104 companies, or nearly 21% in 2014, and a dramatic fall from a decade earlier in 2005, when 248, or just over 48% of Fortune 500 firms had such plans.  Defined benefit plans provided pensioners with specific annual amounts of funds from a company pension following their retirement.  Instead, most companies began to offer “defined contribution plans”, leaving it up to employees to invest for their retirement through various financial institutions.  In 2022, the U.S. Labor Department reported that while 72% of civilian workers had access to an employer-sponsored retirement plan, only about 56% took part in one.  Many other Americans without company pension plans have been forced to invest in a 401(k) (today’s No. 1 retirement vehicle in the U.S.) or other kinds of retirement savings.  The problem is that less than half of working Americans have access to a 401(k) plan.  Many who have a 401(k) at work opt not to participate, and many who do contribute often don’t save enough.  On top of which, many seniors with 401(k) accounts were negatively hit by the Great Recession.  A whopping 36 percent of Americans have less than $1,000 saved for retirement.  As a result, Americans hitting retirement today frequently depend on Social Security as their only source of income, which wasn’t the program’s original intention as a supplemental plan.

In its annual retirement survey in 2007, the Hartford Financial Services Group Inc. revealed that many middle-aged and older adults have serious concerns about their financial security in retirement and are doing almost nothing to shore up their finances.  As a result, the survey indicated that many people plan to “continue working in some capacity while retired,” including one of every two workers in the U.S.  The number of elderly Americans living in poverty is on the increase, particularly following the impact on employment during the pandemic.  Those 65 or older usually weren’t eligible for as much pandemic relief as families with children, thus eating further into their savings.  By 2020, the figure for elderly Americans living in poverty had fallen to 9.5%.  However, in 2021, even as the poverty rate sank for everyone else, it rose among seniors to 10.7%.

In 2009, it was estimated that only about one-third of working Canadian adults have pensions, the majority of which are administered by funds that have taken substantial financial hits with large, unfunded liabilities.  As in the U.S., Canadian companies are relying more heavily on defined contribution plans to lower their human resource costs.  Many elder Canadians have come to rely on government programs such as the Canada Pension Plan (into which they have to pay premiums while working), along with Old Age Security and Income Supplement payments for lower income older individuals.  Although partially indexed to inflation rates, payments under such plans have fallen behind recent cost of living increases.

According to the Organization for Economic Cooperation and Development (OECD), although today’s share of elderly people officially below the poverty line in the U.S. is low by historical standards, it remains among the highest in the developed world, including Canada.  Furthermore, today’s hyperinflation is further cutting into the incomes of seniors in both countries.  In addition, with fewer workers accessing company retirement plans, there is an increasing concern that younger workers may not be saving enough for their future retirements.  Experience has shown that they cannot rely solely on social security payments to live comfortable and active retirement lives, without having to remain in or re-enter the labour force.  Both countries have a growing aging population, led by more and more boomers leaving employment to enter into retirement.  Given that elder poverty is on the increase, one has to question what will be their quality of life after retirement.  What we need today are longer-term solutions, and not small short-term “band-aid” increases in government pension schemes or random handouts.  What we don’t need are governments willing to reduce current high levels of fiscal debt on the backs of seniors.  Companies as well need to attract and retain workers with better funded retirement benefits. 

Moreover, how we treat the elderly is a societal issue!  It’s obvious that as a society, we are indeed at a crossroads when it comes to this important issue.  Given the financial circumstances of most millennials and generations Y and Z, one cannot expect that they will be in a meaningful position to help their parents financially.  Given the projected growth in the proportion of seniors falling on or below the poverty level, there is an immediate serious need for governments, communities and individuals to come to grips with the problem.

Canada Labor Force Labour Force Seniors Seniors US

Leave a comment »
Oct 4

Why The Minimum Wage Is Not A ‘Living Wage’

by bcurry

Going back over four decades, I studied changes across Canada in labour standards legislation, especially as they apply to minimum wages.  The minimum wage is the lowest hourly pay an employer can legally pay an employee whether they work part-time or full-time.  In Canada, minimum wages are primarily the responsibility of each of the ten provinces and three territories.  However, there is a federal minimum wage, which came into force in December 2021, adjusted automatically on April 1 of every year based on the average annual increase of the Consumer Price Index (CPI).  The federal minimum wage applies to workers and interns in federally regulated private sectors, including banks, postal and courier services, and interprovincial air, rail, road, and marine transportation — or roughly 6% of private sector employees in Canada.  The federal rate is currently set at $15.55 per hour.  Provincial and territorial minimum wage rates currently vary from $13.00 per hour in Saskatchewan to $15.50 in Ontario. 

Years after minimum wages were in first introduced in British Columbia and Manitoba in 1918, other jurisdictions followed suit.  Minimum wages are calculated and adjusted differently among the provinces, territories and the federal government.  Rates can be determined and adjusted according to regulations, rates of inflation and social and economic conditions.  In 2013, 61 percent of employees earning minimum wage were between the ages of 15 and 24, especially those working in the services sector (e.g. restaurants and fastfood chains) and the retail sector.  In recent years, there are those who argue that the current minimum wage rates do not reflect what became referred to as a ‘living wage.’  Originally, the formula for minimum wages was thought to be aligned with the average industrial wage rate, usually representing about 60 percent of that rate in Canada.  However, over the years, the determination of annual minimum wage rates became more a political factor based on the policies of the governing parties in power.  As a result, increases in the rates began to vary more extensively among jurisdictions and depended on the particular government in power.  For this reason, minimum wage rates began to lag far behind the rate of inflation and average industrial wage rates.

In today’s economy, many will rightly argue that current minimum wage rates, especially in urban centers, are putting workers in a near poverty situation given the high cost of living in many cities.  Matters have been made worst by the current hyperinflation being experienced across Canada.  As a result, many low-wage workers are required to have more than one job just in order to make ends meet.  Labour advocates say recent minimum wage gains are long overdue.  However, they also now advocate that the long-championed goal of a $15 an hour pay floor across the country no longer goes far enough to address the affordability crisis.  “We’ve been calling for a $15 an hour minimum wage for so many years, but now it’s no longer enough,” said Bea Bruske, president of the national Canadian Labour Congress. “It really needs to be $20 an hour or more when we look at inflation and the cost of food and housing.” 

Business organizations on the other hand continue to use the same old arguments against having a living wage.  These include the argument that higher minimum wages would cause employers to reduce the number of employees and the number of hours worked, potentially leading the hiring of more part-time workers.  A 2014 report from the right-wing Vancouver-based think-tank Fraser Institute concluded that both economic theory and the evidence suggest that living wages, like minimum wages, create distortions in the labour market that have a negative impact on employment.  Left-wing organizations in Canada, including the Canadian Centre for Policy Alternatives and Living Wages for Families continue to campaign for living wages, arguing a higher standard of living will benefit the overall economy. 

Remember what Henry Ford said about higher than normal wages for his automotive assembly line workers in the early 1900’s.  He argued that not only would the high turnover rates for the dull and monotonous work — running at over 300 percent — be reduced, but his workers would eventually buy his Model Ts as many of workers could then afford to buy one for themselves.  In today’s consumer society, one can argue the same is true for many low-income workers if they were to have a living wage.

Canada Economy Labour Force Minimum Wages

Leave a comment »
Aug 22

Both Canada and the U.S. have something in common: Dismal Economic Outlooks

by bcurry

When I was studying economic theory in college, one phrase kept leaping out at me: “Economics is the dismal science.”  This was partly due to the fact that I could never really be convinced that the discipline of economics was anything but a science.  Instead, I preferred to think of the reality of economics being continuously influenced by political policies and institutional structures, including those in the international sphere.  Control over the world’s economies is much more institutionalized than ever before.  The current economic situation in North America really highlights this perspective, especially given the reaction of bodies such as the U.S. Federal Reserve Board and the Bank of Canada in dealing with the post-pandemic world.

In Canada, one is coping with the highest levels of inflation since 1995.  The U.S. is seeing the highest levels of inflation since the early 1980s.  On top of which, we’re getting economic data that is fluctuating quite rapidly, so it’s very hard to get a precise read on where the economy is at any point in time.  The additional fear now is that both these monetary bodies are increasing the prime rates in order to tackle this hyperinflation at a time when the economy is attempting to get back on its feet after the disastrous pandemic period — thus the concerns about a potential recession in both countries and around the world.

Now, you don’t have to be an economist to know that something’s wrong.  Filling up your gas tank, buying a home and purchasing groceries just got incredibly more expensive!  Governments blame much of the distress on post-pandemic supply chain problems and global fuel-food shortages due to the Russia-Ukraine war.  On top of which, there are suddenly skilled labour shortages in most countries, leading to increasing wage levels and low unemployment rates.  The current situation has particularly been led by Boomers, many of whom have chosen to retire.  An April paper by economists at the Federal Reserve Bank of Richmond found that “the pandemic has permanently reduced participation in the economy.”  Due to the lack of and high cost of child care for example, many women are financially unable to return to the labour market.  In order to fill many jobs, countries are having again to look to immigration policies as a possible solution.

Recent blow-out jobs reports may have quieted claims that the U.S. is in a recession, but it did not end the mystery about the state of the economy or resolve questions about where it is headed.  Should a recession evolve in the U.S., past experience would suggest that Canada is not far behind.  Similarly, both federal governments are under the gun to do something about inflation — a major political issue.  However, as most analysts state, the current economic situation is something completely new and unprecedented in light of post-pandemic elements and the current global situation with respect to supply chains, especially in Europe.

Higher interest rates as a result of Federal Reserve Board and the Bank of Canada benchmark interest rate increases to control the hyperinflation will have an immediate impact on lowering economic growth.  Consumers feeling the hit will most likely have to cut back on expenditures, including the purchases of homes due to the subsequent rise in mortgage rates.  Whether or not we are on the brink of a major recession is still up in the air.  There is no sector of the economy that hasn’t been affected during this so-called recovery period. 

However, how about longer-term predictions?  As the famous British economist, John Maynard Keynes, once said: “In the long-run, we are all dead.”  He further noted that aggregate demand does not necessarily equal the productive capacity of the economy.  Instead, it is influenced by a host of factors —sometimes behaving erratically — affecting production, employment and inflation.  As of today, this definitely appears to be the case.  All any of us can do is hope to survive during the foreseen continuing turmoil within the markets and the economy in general.  In the spirit of economics as a ‘dismal science’, most economists for are not overly optimistic about improved short-term growth. 

Canada Economy Economy Global Economy Labor Force Labour Force US

Leave a comment »
Aug 9

Would You Be Interested In A Four-Day Workweek?

by bcurry

Between 2015 and 2019, several large-scale trials in the public sector of a four-day workweek were carried out in Iceland.  The results showed that the trials turned out to be an “overwhelming success,” with many workers shifting to shorter hours without affecting their productivity.  Some of the trials’ key findings showed that a shorter week translated into increased well-being of employees among a range of indicators, from stress and burnout to health and work-life balance.  The idea of the four-day week has been gaining ground in countries like New Zealand, Spain and Germany.  In the U.S. and Canada, a small but growing number of firms are moving to a four-day workweek that runs from Monday to Thursday.  In addition, the pandemic created a situation where employers began to experiment with alternative working arrangements, ranging from remote work to a variety of hybrid work routines including a four-day workweek.  Employers are expected to continue offering alternative working arrangements as a means to retain existing employees and to recruit new workers, especially given the tight labour markets found in most countries.

Now, there is not really anything new about employers implementing a four-day workweek for interested employees.  Long before the pandemic, I can recall several employers, especially in the public sector, who instituted policies allowing for some employees, where applicable, to work for four days a week and with the same number of weekly hours and wages.  For certain employees, the additional day off meant that they could spend more time with their families and use the extra free time to improve work-life balance.

More recently, there are those that would argue that a four-day workweek would help to reduce our carbon footprint.  For example, one or more fewer commutes to and from work would be required each week.  Transportation is the biggest contributor to greenhouse emissions, especially for vehicles using gas or diesel.  In 2020, according to the Environmental Protection Agency (EPA), the transportation sector accounted for about 27 percent of total U.S. greenhouse gas emissions.  Commuting is a big part of that.  It’s noteworthy that global emissions plunged an unprecedented 17 percent during the coronavirus pandemic and the air quality in cities around the world showed a marked improvement.  In North America, the high cost of housing in urban cores has meant that many workers have bought more affordable homes in the outskirts, a trend increased during the pandemic by a significant percentage of workers working remotely from home.

In addition, Juliet Schor, an economist and sociologist at Boston College who researches work, consumption and climate change, noted that energy could also be conserved if less resources are needed to heat and cool large office buildings.  However, to reduce demands on electricity, buildings would have to be pretty well shut down entirely for a day.  According to Scientific American, when the Utah state government launched a four-day workweek trial among its employees in 2008, one report projected that shutting down buildings on Fridays would lead to a decrease of at least 6,000 metric tons of carbon dioxide emissions annually.  However, any potential energy-saving gains hinge on how companies and individuals use resources.  At a time when many companies are looking at ways to incur cost savings, the implementation of a four-day workweek might be appealing.

As more and more white-collar workers across the country settle into hybrid work routines, one thing is becoming clear: Nobody wants to be in the office on Fridays.  This premise came up time and time again in several related articles.  With hybrid working routines becoming more of a fixture in workplaces, it’s easy to see why employers are increasingly looking for more adaptable offices with more communal spaces and gathering areas instead of traditional cubicles or walled-in offices.  Issues surrounding work-life balance and healthy workplaces will continue to surface in the post-pandemic era.  Businesses and their workers will no doubt have to be more creative in developing appropriate alternative working arrangements, including possibly a four-day workweek.

Canada Cimate Change Climate Change Labor Force Labour Force Reopening the Economy US

Leave a comment »
Aug 2

Return to Offices in Post-Pandemic Era

by bcurry

Over two years after the pandemic abruptly forced tens of millions of people to start working from home, disrupting family lives and derailing careers, employers are now getting ready to bring workers back to offices.  However, it appears that workers in North America’s midsize and small cities have returned to the office in far greater numbers than those in the biggest cities.  Offices apparently have filled back up fastest in areas where COVID lockdowns were shortest and where commutes are done by car, rather than by public transit. 

In light of the Omicron variants which are creating other waves, the fact that the COVID pandemic is not over has created a snag in how employers are dealing with remote and in-person work.  In particular, the situation has forced some large and major employers to delay a return to the office.  The pandemic has also pushed employees to look at the health and safety protocols of their jobs and to become more vocal about the level of risk and the hazards they are facing.  Recruiters note that regional differences in office attendance and flexible work are making for a bumpier job market, especially given the increased competition for skilled workers in the current labour market.  In certain cases, some companies are forced to advertise jobs where the work is primarily done remotely.

Back-to-office plans have to take into consideration a number of challenges in order to accommodate workers in a healthy and safety manner.  The era of stuffing people into offices like sardines is over.  The inadequacy and poor quality of many existing office buildings was simply illustrated by the conditions surrounding the pandemic.  Indoor ventilation, air filtration and overcrowding became major concerns given the fact that highly infectious COVID was shown to be primarily spread as an aerosol.  The interior of many office towers today are climate controlled whereby one cannot open the windows in order to increase air quality.  Improving the ventilation and filtration systems has led to increased costs for landlords and tenants alike.  Another cost has been the need to have more stringent and frequent cleaning practices.

With health restrictions lifting, many workers are being called back to the in-person workplace, which can bring up a number of different feelings.  Employers can help ease this transition by having a comprehensive return-to-work plan, and clearly communicating it to workers.  Besides potential physical health hazards, there is also a need to address potential psychological hazards given the anxiety and stress that some returning employees may incur.  A gradual return to the workplace may ease anxiety, possibly by allowing for partial in-person work in the initial stages of the return-to-work plan.  There may also be a degree of anxiety of employees working alongside people who have not been vaccinated for COVID.  The question of mandated vaccination of workers became a highly controversial issue during this pandemic, causing a major schism between the vaccinated and unvaccinated.  Employers will have to address the issue as a policy matter and communicate their policy in a clear and concise manner.  They will also have to acknowledge and follow up on worker concerns or complaints.  They will have to show compassion and understanding that workers, particularly those that are immunocompromised, may be stressed, harassed or feel anxious.

How long will employers remain flexible?  When the pandemic loosens its grip, inevitably bosses could well demand that people file back in, and pronto.  The real question is whether the return-to-office plan will be done in a gradual, effective and controlled manner.  Several serious issues will have to be considered by employers as part of their plan, as highlighted above.  If the plan is not well thought out and effectively communicated, the issue of employee retention will quickly surface.  The situation of each individual employee will have to be taken into account and continuously monitored at the outset.  Flexibility is a key.  Employers may incur additional initial costs but they will be worthwhile in the long run.

Canada Coronavirus COVID-19 Labor Force Labour Force Reopening the Economy US

Leave a comment »
Mar 4

Comparison of Workers’ Wages and Benefits Between the U.S. and Canada

by bcurry

In recent months there has been a lot of discussion about the impact of the pandemic on the labour market in both the U.S. and Canada.  Much of the discussion has now evolved around the issue of hyperinflation in both countries and the resulting worker demands for increased wages.  In addition, there has been a shift in the labour market itself whereby many workers who worked in certain sectors, in particular retail, tourism, services and restaurants, were laid off due to COVID-19 for months on end.  Now that the economies are supposedly reopening in both countries, some of these workers have decided not to return to those sectors, but to seek other more reliable and better paying employment.  Indeed, according to recent stats, there have been record levels of workers switching jobs, a trend that picked up markedly in the second half of 2021.

However, there are still signs that wage raises are stopping fall short of compensating for all of the higher prices.  In some private sectors, unions are now taking advantage of the inequalities and have moved to organize disgruntled workers, offering better wages and benefits.  An example of this is the American United Auto Workers (UAW) that is looking to organize Tesla workers.  Several Starbucks workers have been seeking to organize unions in Buffalo, Boston, Chicago, Seattle, Knoxville, Tallahassee, Florida and the Denver area.  The International Association of Machinists and Aerospace Workers promoted a two-year-long push to unionize thirty Amazon facilities in the U.S.  Generally, such attempts have been unsuccessful.  In Canada, where unionization is easier in the private sector under industrial relations laws, certain unions have been more successful in organizing workers in facilities run by union-resistant companies such as Wal-Mart and Starbucks.

Among the major differences between the two countries is the fact that Canada has a universal health system in place and more labour standards laws offering such benefits as paid sick leave, maternity and adoption leave, paid vacation leave and higher minimum wages.  Canada’s federal unemployment insurance program is national in scope, unlike in the U.S. where states have a lot more leeway to differentiate in their qualifying requirements, amounts and duration of unemployment benefits.  Moreover, the Canadian safety net for the unemployed has been strengthened in recent years, playing an important part in allowing unemployed workers to do lengthier job search, provide additional economic security and keep their job protection guaranteed under the law.

On top of everything, workers are looking at the huge profits made by certain companies during the pandemic, such as Amazon, Wal-Mart, Loblaws Canada, etc., etc.  Many believe, and rightly so, that they have not received their fair share of the record profits in the form of increased wages and benefits.  Instead, they see companies buying back billions of dollars in stock from investors and increasing the dividend rates given to investors by large amounts.  With companies declaring the end of the worst of the pandemic, previous increases in the form of risk pay are also quickly disappearing — this despite the fact that many of the pandemic risks still remain.

Moreover, the pandemic has had a significant impact on the labour markets of both countries.  Employers in both countries are being forced to compete for scarce labour due to the shift in the bargaining capabilities of workers, especially in light of today’s hyperinflation.  Indeed, wage increases are just one of many sweeteners that hungry firms are offering.  Also on the rise are perks like a four-day workweek — offered by some eleven percent of companies surveyed recently by the Payscale data firm —  as well as remote work, flexible schedules, free college tuition and other attractive benefits.

All in all, current hyperinflation will continue to cut into workers’ pay cheques.  The coming months will be difficult ones for both employers and workers.  Both Canada and the U.S. have similar labour markets, suggesting that significant adjustments will have to be made in each country.

Canada Economy Economy Labor Force Labour Force US

Leave a comment »
Newer Entries »
Blog at WordPress.com.