Business and Labour Perceptions and Reality

1. Business and LabourPerceptions and Reality Windsor-Essex Policy and Solutions Forum Bill Murnighan Research Director Unifor Windsor, May 15, 2014

2. Business and LabourPerceptions and Reality(..and some bold insights!) Windsor-Essex Policy and Solutions Forum Bill Murnighan Research Director Unifor Windsor, May 15, 2014

3. Myth # 1: Unions Are Bad for the Business Environment 3

4. Reality: Best Global Business Environments = Highly Unionized 4

5. Reality: Best Global Business Environments = Highly Unionized 5

6. Myth #2: Unions Get in the Way of a Productive Workplace 6

7. Reality: Unions Improve the Workforce and the Business 7 • Higher value of labour means more investment in skills, better tenure, move firm up the value chain. • Unions provide a “voice” in workplace. Research shows that a credible system and process for dialogue and problem solving yields best outcomes. • A clear, consistent, mechanism for dealing with upswings and downturns means flexibility, skills retention and fairness in workplace. • Increasingly for “millennial” generation, workplace culture and fairness at work are central.

8. Myth #3: Unions are Killing off Manufacturing Jobs. 8

9. Reality: Unionized Manufacturing Recovered Better Since Recession 9 • All manufacturing hit hard, but unions certainly not behind the job losses (dollar, trade, lack of policy). • In Ontario, since recession in 2009: • Unionized manufacturing up: + 19,000 jobs • 2009: 152,000 vs. Now: 171,000 • Non-union manufacturing down: - 40,000 jobs • 2009: 598,000 vs. Now: 558,000 • Never applaud any job loss. Other factors at work, maybe union is actually a stabilizing force.

10. Myth #4: Unions Make Canada a High Cost Location for the Auto Industry. 10

11. Reality: Labour Costs in Auto Production Only 4% of Total. 11 • “Some perspective please.” • Detroit 3 automakers pay for an average 29 hours of production labour per vehicle (others the same). • “All-in” costs, even exaggerated levels, amount to $1,700 per vehicle, or 4% of final price of a $41,000 vehicle. • 96% of cost structure is elsewhere. • Despite this, we ensured that our costs fully comparable to U.S. costs in 2012 bargaining. Dollar now 10¢ lower. • Non-union: Toyota very similar compensation package. • Makes good political sport: but not realistic appraisal.

12. Myth #5: Unionized Workers Mean Low Quality and Poor Productivity. 12

13. Reality: Building to Highest Quality and Productivity Standards 13 • Year-in, year-out, Canadian unionized plants score top quality awards and hit peak productivity. • J.D. Power 2013: Chevrolet Camaro and Impala; Chrysler Town & Country; are the top quality vehicles in their segments. • Chrysler 300, Chevrolet Equinox and Buick Regal in top three. • GM Oshawa: Silver Plant Assembly Line Quality Award for North and South America. • Productivity advantage: Harbour Reports (mid-90s through 2008) always had Canadian plants on-top, international industry measures show 5%-10% productivity advantage. • Windsor: Silver Designation World Class Manufacturing.

14. Myth #6: Unions in the Auto Industry are Rare and a Thing of the Past. 14

15. Reality: Whole Global Auto Industry is Unionized 15 • All of E.U. (VW, Mercedes, BMW, Peugeot, Fiat, plus…) • All of Japan (Toyota, Honda, plus) • All of South Korea (Hyundai, Kia) • All of Mexico. • Almost all of South America, South Asia, Africa. • Detailed look at industry-leading Toyota with 60 plants around the world: 90% unionized. • ONLY U.S. and Canada among developed nations do we see non-union plants. • Global growth: more unions, even in China!

16. Myth #7: What Really Matters for Auto Investment are Low Taxes and Wages. 16

17. Reality: Dozens of Factors 17 • Many variables. • Each decision weights them differently. • Research from: • Industry Canada • Public Policy Forum • Canadian Automotive Partnership Council • Taxes and labour costs not often near the top.

18. Myth #8: Canada Already Has An Auto Strategy 18

19. Reality: A Few Bits and Pieces but Nothing Comprehensive 19 • Everyone wants what we already have, and governments very active in trying to get it. • Why? Goose that lays the golden egg, 10:1 jobs, economic development. • Every other jurisdiction hasaggressive policies: investment, trade, infrastructure, technology, skills. • Key is long-term, engaged, and significant policies. • Union plays big role in this: recall our union’s 2012 auto policy recommendations, report and campaign. • Building consensus, leading public debate, securing commitments from decision-makers facing competing priorities.

20. Business and LabourPerceptions and Reality Windsor-Essex Policy and Solutions Forum Bill Murnighan Research Director Unifor Windsor, May 15, 2014