Because of the tight labor market in Canada, workers should be making big gains. But with nearly as many unemployed workers as job vacancies, it appears that employers are simply not offering high enough wages to entice people to take jobs.

Recently, there have been many encouraging signs pointing to a strengthened position for labor, such as higher than average wage gains in new collective agreements and union organizing victories in the service sector. However, the fact that many employers are still not offering high enough wages to entice workers is a sign of a looming problem. A very small uptick in employment in September has not made up for the previous three-month streak of employment losses.

With the Bank of Canada continuing to raise interest rates in order to curb inflation and economists warning that it risks causing a recession, employers may have decided that sooner or later workers will be disciplined by the market and accept whatever jobs they can get. For their part, the labor movement and the New Democratic Party (NDP) have not provided the bold leadership that will be required to counter the erosion of workers’ current leverage or a possible recession.