A report released in May by the Canadian Federation of Independent Business (CFIB) is riddled with questionable methodology and the claims it puts forward are wrong. CUPE National President Paul Moist sets the record straight in this op-ed, published on June 4 by the Vancouver Sun.
Attacking municipal workers won’t fix potholes
Canada’s cities and towns are facing a daunting challenge. The bridges, roads, water and waste water systems, and community centres we all depend on every day are in dire need of repair and replacement. Our over $120-billion infrastructure deficit is a national crisis that needs all levels of government — municipal, provincial and federal — to work together to address.
But some are intent on sabotaging efforts to find a fix, as evident from the latest report from the Canadian Federation of Independent Businesses.
Released in May, the CFIB report Big City Spenders tries to argue spending by municipal governments is wildly out of control due to the wages, benefits and pensions of municipal workers. And it’s these excessive salaries that are causing infrastructure to fall into disrepair.
However, the CFIB report is riddled with questionable methodology that tries to pass off misinformation as research. This is not a matter of opinion or a contrary interpretation of nuanced data. Simply put, every single claim the report puts forward is just plain wrong.
The report’s key piece of evidence is that municipal government spending increased by 55 per cent — adjusted for inflation — between 2000 and 2011, outpacing population growth of only 12 per cent during the same period.
While this point makes for great headlines, as the foundation for a report it is practically useless.
A much more suitable measure is looking at government spending as a share of the economy — the GDP. Using this measure you’ll see municipal government spending as a share of the economy is still close to the lowest it’s been in the last 30 years.
The CFIB used 2000 as a convenient start for its comparison as it marks a relatively low point in municipal government spending.
The most obvious flaw in the CFIB report is the comparison of spending to wages. Regardless of what measure is used to report spending, wages have not been the driver of municipal spending increases. In fact, while municipal spending as a percentage of GDP has remained stable, compensation in the municipal sector has declined by 23 per cent.
Actual average wages paid by local governments have increased at a lower rate than overall average wages in Canada, and barely above the rate of inflation.
Average weekly wages paid by local, municipal and regional governments rose from $622.67 in 1991 to $952.86 in 2012, a compound annual increase of two per cent, barely above the period’s average inflation rate (1.9 per cent). This works out to an average of $49,549 in 2012 for salaried workers. Average pay for hourly local government workers was considerably lower: an average of about $40,000 in 2012.
For a country struggling with high unemployment, especially among young people, and many Canadian workers facing increasingly precarious work situations, these are good paying jobs. But they are hardly the lavish and excessive salaries the CFIB tries to portray.
For good measure, this latest CFIB report retreads its previous claims public sector wages are wildly higher than those in the private sector — a claim conclusively disproven by Canadian Union of Public Employees economist Toby Sanger in his 2011 Battle of the Wages study. While the average wages of public sector workers are slightly higher than private sector counterparts doing similar work (0.5 per cent), the gap is almost entirely due to superior pay equity for women in the public sector.
Clearly, municipal workers are not the problem.
After decades of cuts to federal and provincial programs, municipal governments are being forced into picking up the costs of vital public services — such as social housing and child care. On top of that, municipal governments are under increasing pressure from the Harper Conservative government to privatize public services through risky public-private partnerships in order to get federal infrastructure funding.
These are the real issues facing municipal governments. Clouding and confusing them with cynical misinformation helps no one, and is a disservice to the small businesses and local economies that depend on public services and infrastructure.