Home>> Business>>Weekly earnings are steadily improving for some — and surging rapidly for others
Business

Weekly earnings are steadily improving for some — and surging rapidly for others

Kevin Carmichael: It looks like workers have gained at least some bargaining power through the pandemic

Article content

A basket of goods that cost $406 in March 2001, the average weekly pay of a retail worker that month, would require a payment of $583 in today’s dollars, according to the Bank of Canada’s inflation calendar. Some 1.95 million retail workers earned a weekly average of $633.03 in March of this year, according to Statistics Canada’s latest payroll survey, so those frontline workers are no worse off than they were in 2001, which is as far back as the data go.

But they probably feel worse off. Their job is helping consumers part with their disposable income, so every day they are at work, salespeople, grocery clerks and others would see with their own eyes that almost everyone has more money to throw around than they do.

The monthly Survey of Employment, Payrolls, Earnings, and Hours (SEPH) offered new proof of that reality when it was published on May 27. The SEPH is mostly ignored on Bay Street because the data are two months old by the time they are published. But the report is good for tracking trends as it’s more reliable than the Labour Force Survey.

Advertisement

This advertisement has not loaded yet, but your article continues below.

Article content

One of the more striking features of the SEPH is pay disparity. The roundup of weekly earnings is a statement on how little we value retail workers, many of them “heroes” of the pandemic because they dutifully went to work at grocery stores and other essential outlets, keeping households supplied with baking ingredients, booze and backyard furniture. The average weekly earnings of retail workers were $492.24 less than the overall average, compared with a gap of about $250 in 2001.

Retail wages are staying ahead of inflation, but that’s about it.

Wage inflation

Chris Fowler, chief executive of Canadian Western Bank, said earlier this year that he wouldn’t get overly worried about inflation until he started to see it show up in wage expectations. The data might still be too noisy to justify serious worry, but it might be time to take the possibility seriously. 

Labour costs are soaring along with most other input prices. Average weekly earnings increased 7.4 per cent in March from a year earlier, compared with an annual increase of 3.2 per cent in March 2020, according to Statistics Canada’s latest Survey of Employment, Payrolls, Earnings, and Hours, which was published on May 27. 

  1. A change in the way Canadians shop for food could be part of the reason behind the shift toward part-time work at grocery stores.

    Grocery clerk and cashier jobs trending toward lower pay, less stability in Ontario: report

  2. A hybrid of working from home some days and in the office others is fraught with challenges.

    Working from home and the office won’t be as easy as you think — podcast

  3. None

    Canada’s transition to a knowledge economy could suffer if business doesn’t take mental health seriously

  4. None

    No recovery without ‘she-covery’: Women bear the brunt of latest jobs decline

Advertisement

This advertisement has not loaded yet, but your article continues below.

Article content

The average year-over-year increase since 2002 was 2.8 per cent, so something is going on. Wages were depressed for years after the Great Recession, so some catchup is overdue for many households. It’s also a difficult moment to make comparisons with past years because a disproportionate number of the 500,000 workers who remain unemployed are at the low-end of the payscale. Their absence raises the average weekly pay of those who have jobs. 

Still, it looks like workers have gained at least some bargaining power through the pandemic. The following chart highlights the changes in select industries from 2019, a more solid baseline, as March 2020 marked the start of the COVID-19 recession. Frontline workers are relatively doing well, which is encouraging. Let’s hope their employers absorb most of the increase rather than add to the upward pressure on inflation by raising prices for goods and services. That’s how inflationary cycles begin.

average weekly earnings

These items first appeared in the FP Economy newsletter. Sign up here to get it delivered to your inbox every Monday.

Advertisement

This advertisement has not loaded yet, but your article continues below.

In-depth reporting on the innovation economy from The Logic, brought to you in partnership with the Financial Post.

Comments

Postmedia is committed to maintaining a lively but civil forum for discussion and encourage all readers to share their views on our articles. Comments may take up to an hour for moderation before appearing on the site. We ask you to keep your comments relevant and respectful. We have enabled email notifications—you will now receive an email if you receive a reply to your comment, there is an update to a comment thread you follow or if a user you follow comments. Visit our Community Guidelines for more information and details on how to adjust your email settings.

donate

Please disable Adblock!

Leave a Reply

Your email address will not be published. Required fields are marked *

%d bloggers like this: