"The unemployment rate among young people, 35%, is almost four times the national average." "Their suicide rate is twice that of Japan or the U.S."
The statistics were from Australia, but they could just as well have been from Quebec. One might add that youth also differ in the kind of work they get: short-term or part-time work, freelancing, and other unstable sources of income. Unemployment, job insecurity and poverty are all abnormally high in younger age groups.
It wasn't always so. At the turn of the century, unemployment was lower among the young and higher among the old. To allay fears of increasing job insecurity with advancing age, and also to foster employee loyalty, Henry Ford pioneered the idea of a level playing field for older and younger workers. A new terminology was developed to describe these new labour practices: seniority, "bumping", and attrition.
Seniority is based on FILO — "First In, Last Out" . Its most common version is "bumping": a senior employee can "bump" a more junior employee out of a job anywhere in the company, even though the latter employee has had more experience at that kind of work. A related concept is that of downsizing by attrition: a company cuts the size of its workforce by freezing hiring and not by dismissing the least competent. Attrition may seem more innocuous than bumping, but its economic effect is the same. The pain of downsizing is transferred from those already employed to those who are entering the job market — generally, young people and women.
At first, these practices were limited to a few industries. Young people could always get their first toehold elsewhere. During World War II, however, both unions and governments throughout the Western World made seniority a cornerstone of collective bargaining. As unionization spread through the public sector, itself growing by leaps and bounds until the early 1970s, young people found fewer and fewer entry-level positions open to them.
Many labour leaders are aware of this problem. They are, however, caught in a vicious circle. The more the union movement fights for seniority rights, the more its age composition shifts towards older workers, whose main concern is seniority rights and not youth unemployment. Today, fewer than 15% of CSN members are under 30.
In recent years, other factors affecting youth unemployment have come into play, notably a dramatic rise in payroll taxes. Because these taxes are subject to "ceilings" for each full-time position, employers find it cheaper to make their employees work longer hours — as opposed to creating new jobs. Thus, in Canada, we have the strange sight of overtime pay reaching record levels at a time of record unemployment. Once again, this has meant fewer opportunities for people entering the job market.
The structural causes become evident if we look at other developed countries. The spread between the youth unemployment rate and the national unemployment rate is smallest in the United States and Japan, where payroll taxes are low and where unionization is either weak (only 15% of U.S. workers) or dominated by company unions. By contrast, this spread is largest in Australia, Canada, and Western Europe — where strong public-sector unions have fought hardest for seniority rights and where sympathetic governments have provided generous benefit packages that have to be funded by ever higher payroll taxes.
With the best of intentions, these countries set out to make life better for working men and women. The unintended corollary, however, was to make life worse for the unemployed and those stuck in the limbo of "non-standard" employment. As a result, Canada now has large numbers of young people with plenty of time on their hands and no place in society. The recent riots should not have come as any surprise.
More is at stake than the cost of replacing broken shop windows and paying for more frequent police patrols. There is also the cost that comes from excluding our youngest and most dynamic elements. When GM laid off its younger workers in the mid-70s, productivity slumped and product quality declined. In disgust, many buyers turned to Japanese imports.
There are other costs, which call into question the viability, if not the survival, of our institutions. Ultimately, the young people of today will have to support the retired baby boomers of tomorrow. This promises to be a daunting task and it is in the interest of everyone to ensure that young people have the means to "pay the bill".
To ignore these realities is to undermine our society's ability to survive in the long term. Consider, for instance, what happened when young people drifted away from our choir because, rightly or wrongly, they felt left out. Regular attendance at the weekly practice began to fall, slowly at first, then faster: from 20 to 15 to 9 and finally ... to 4. Even longtime members had stopped coming. That decline, in turn, seemed to set off an erosion of our membership, which in turn triggered a drop in givings and a widespread loss of faith in our future as a viable institution.
Such is the price we pay for shortsightedness — the right to a comfortable seat in a half-empty building. Will Canada's fate be much different?