Social Policy in Ontario

Stanford, who moved to Australia in 2015 and now works at the Centre for Future Work think tank, spoke to the Star about the future of the manufacturing industry in Canada, lessons from the Australian auto industry and why the gig economy is not the next natural evolution of work.

Toronto Star: There seems to be an assumption that the future of work in a modern economy is destined to be more precarious. Is this a certainty?

Jim Stanford: It’s certainly heading in that direction. But I don’t for a minute accept that it is inevitable or preordained. Work has become dramatically more precarious in Canada over the last generation. I estimate about half of employed Canadians have some dimension of precarity in their work. That could be part-time, it could be temporary or time-limited contracts, it could be labour hire, it could be these dodgy forms of self-employment that we’re seeing — everything from gigs to more traditional forms of contracting out, where people are constituted as businesses rather than workers, in a very artificial way.

TS: OK, if it’s not inevitable, how do you envision slowing it down or stopping it?

JS: That trend will not stop of its own accord. But I don’t think it’s driven by market forces, or by technology. I think it’s driven by our choices as a society about how to organize the labour market. We absolutely could make different choices. As an example: Everybody knows about Uber. It’s a company that developed an app that’s a new way to hail a taxi. The actual work hasn’t changed one iota. There’s still a car and a driver and they pick you up at point A and they take you to point B. The only thing technology has changed is the employment relationship. Uber has seized on that opportunity to redefine its workers in a way that removes most of their traditional rights. That isn’t driven by technology at all, and it isn’t inevitable. You could have an app-based taxi-hailing system where workers are given the same rights. This claim that this is inevitable and is driven by the onward march of technology is absolutely false.

TS: Competing with lower-wage jurisdictions and automation are both making work more precarious as well. Is thatinevitable?

JS: It depends on what choices we make as a society regarding who’s got rights, who’s got power, who’s got freedom and who doesn’t. We have signed trade agreements that allow General Motors to shut down Oshawa, produce exactly the same vehicles in Mexico, and sell them back in Canada without any tariffs or obligation. So in that framework, why would GM do anything different? That decision was not driven by technology — it’s the same technology. That decision was not driven by electric vehicles or any of these other innovations, not remotely; they’re exactly the same cars being produced in Mexico and still being sold in Canada. So we have organized the economy in a way that gives employers, whether it’s Uber and the digital platforms or General Motors and more traditional manufacturing, the power to unilaterally determine where people are going to be employed, how they’re going to be employed and how much they’re paid for it. .

TS: We’ve all heard the argument ‘manufacturing is a lost cause, let’s focus on the knowledge economy and training and education.’ Do you think manufacturing jobs still matter?

JS: Manufacturing jobs are more important than jobs in some other sectors of the economy, and it’s not because of nostalgia for manufacturing. It’s because of the qualitative features of manufacturing — it is innovation-intensive. There’s more R & D in a dollar of GDP in the manufacturing industry than any other sector of the economy. Secondly, it’s very export-oriented, so most of what you manufacture gets sold to global markets, and that’s essential for your trade performance. Third, manufacturing has the most developed supply chain of any sector, which means capturing an assembly plant or any other strategic installation in manufacturing supports thousands of other jobs in the supply chain. Fourth, manufacturing has high productivity and growing productivity. As long as you’ve got the power to transform productivity into wages, then you can get higher and growing incomes.

Manufacturing isn’t the only industry where these factors are at play, but it’s certainly one of the most important ones, and it’s a huge mistake to just naively think that if manufacturing disappears, then we’ll somehow automatically get jobs in the knowledge economy that we’re supposedly better suited for. That’s nonsense.

TS: Do we have the training and educational infrastructure in place to take advantage of the knowledge economy?

JS: First of all, I’m very skeptical of even the term ‘knowledge economy.’ We don’t actually eat knowledge, we don’t consume knowledge, we don’t drive around in knowledge. Knowledge is an input to all parts of the economy. So it’s jargon to say ‘we’re shifting from the old economy to the knowledge economy.’ My concern is I don’t think Canada’s economy is actually held back by a lack of skills. Our workforce is better skilled than it has ever been, and we actually have millions of Canadian workers in jobs that don’t remotely use the skills that they have. So yes, we should be continuing to invest in skills and the knowledge infrastructure, including public and private research, and clusters and business parks and everything else that goes with it. But we also need to be actively nurturing the jobs that people with those skills can most productively do. And that won’t happen of its own accord. This is where we need the 21st-century equivalent of policies like the Auto Pact or our aerospace agreements or our other policies which brought technology-intensive industries to Canada in the first place. They only came to Canada because smart policy interventions brought them to Canada. We hustled for them, and we put in place rules. We said to a company like Boeing, for example, ‘you want to sell a bunch of extremely expensive aircraft to Air Canada? Well, you’re going to have to produce something in Canada.’

TS: If we look at the industry in Australia, where you’re based now, the auto assembly industry basically no longer exists. Is that looking like the future of the industry here?

JS: The Australian industry is a warning for Canada. There were similar arguments being made in Australia: that manufacturing is old, we don’t need to worry about it, we’ll find something else to do. They lost their focus on what’s required to keep an industry like auto at a critical mass level in your country. And lo and behold, they got whittled away to nothing. There is no mass vehicle assembly left in Australia, whereas it used to be one of the 10 biggest auto manufacturers in the world.

TS: On a personal note, why did you leave for Australia? Do you have any plans to come back?

JS: I left for family reasons. I finished up with the union at the end of 2015. My partner got a great job at a university in Sydneyand I started this job with a think tank. It’s been a very interesting time but I miss Canada a lot. As for when I get back , I don’t know when, but I think I will at some point.”

https://www.thestar.com/business/2019/07/08/jim-stanford-on-uber-and-the-future-of-precarious-work-it-isnt-inevitable.html