Workers are Especially Exposed to the Economic Risks of Alberta Separation

Albertans will vote on October 19 in an unusual ‘referendum on a referendum’, initiated by the Alberta government of Premier Danielle Smith. The referendum asks voters whether they prefer to stay part of Canada, or prefer to initiate a process of negotiation and preparation fo0r a binding referendum on separation some time in the future.

Many economic, business, and civil society leaders have warned of the economic risks and costs of even a significant threat of Alberta independence, let alone outright separation. But working people are especially exposed to those risks, for several reasons: they need employment, they depend disproportionately on federal income supports (like CPP, EI, and the Canada Child Benefit), they depend on unions and labour standards to negotiate their wages, and they are less mobile across borders than investors or high-income households.

The Centre for Future Work has explored the particular risks facing Alberta workers from the separatist movement, in a new report published in conjunction with the Alberta Federation of Labour.

The report challenges several of the myths propagated by the separatist movement – in particular, claims that an independent Alberta would be richer, have lower taxes, and more opportunity to sell products to other countries.

It also reviews several statistical indicators of declining living standards for Alberta workers in recent years. It finds that Alberta workers are quite right to be angry about stagnant wages, falling purchasing power, and growing insecurity in the province – but those problems should not be blamed on a distant federal government. Rather, they result from problems right at home in Alberta, in particular the distorted playing field of labour relations, which has undermined the bargaining power of Alberta workers to negotiate better jobs and wages.

The economic pie in Alberta has been growing: oil and gas production and export set new records every year, and output per worker is the highest in Canada. But labour’s share of that economic pie (in wages, salaries, and benefits) has been shrinking faster than in any other province, and average wages now barely match the Canadian national average.

The report concludes that by defeating the false hopes of separation, workers in Alberta can refocus their rightful anger on the task of reforming Alberta’s labour and economic policies, so that the province’s abundant wealth can be shared more fairly.

Please see the full report, False Promises, Big Dangers: How Separation Would Hurt Alberta Workers, by Jim Stanford, Economist and Director of the Centre for Future Work.

The report generated abundant media coverage, including:

• Newspaper articles in the Calgary Herald and the Lethbridge Herald.
• Interviews on CBC Radio and 880 CHED.
• A feature interview with Ryan Jesperson’s Real Talk video podcast.
• A commentary in The Tyee, targeting the myth that Alberta ‘subsidizes’ the rest of Canada.