In early 1996, the Canadian Labour Market and Productivity Centre (CLMPC) surveyed 1500 Canadian business, labour, and public sector leaders to explore their views on major economic issues and potential solutions, alternative work arrangements, and the current state of labour/management relations in Canada. The survey is a point-in-time snapshot of constituency leaders' perceptions of these issues. It will be used both as a catalyst for dialogue among business, labour and others and as a point of comparison for future surveys.

The focus is on respondents' perceptions of particular issues. A sense of the different perceptions among constituencies will help in the interpretation of how they might strongly influence attitudes and actions. The basis and accuracy of perceptions will be the platform for further dialogue.

Readers are encouraged to share their comments and suggestions concerning the survey's content, findings and methodology. The feedback will help the Centre improve the conduct and value of similar survey.

The CLMPC's 1996 Leadership Survey questioned 1500 Canadian business, labour and public sector leaders on major economic issues and potential solutions, alternative work arrangements, and the current state of labour/management relations in Canada. It is anticipated that this survey will be conducted regularly. In presenting the major findings, this report identifies both the similar and differing perceptions of the leaders of these communities concerning particular issues.

There is a strong consensus that a lack of jobs is the most serious issue facing Canada at present. This is followed by concerns about the lack of a national consensus on economic priorities, uncertainties regarding national unity, and high taxes. However, business priorities include government debts, deficits, and regulation whereas labour highlights the importance of environmental degradation issues.

In the same vein, there is a marked difference in the emphasis with which individual constituencies would accord various potential solutions. While business, labour and government agree on the need to improve education, training and research and development, business stresses the reduction of government deficits, while labour emphasizes lowering interest rates.

Of particular interest are the survey's findings on the state of labour/management relations in Canada. The perceptions of labour differ from those of the business and the public sector. Labour leaders view current labour relations as poor or very poor. An even higher proportion feel that labour/management relations have worsened over the last two years.

All three constituencies agree that labour/management relations are better at the workplace and industry levels than at the national level. They also agree that the effects of current labour/management relations on a variety of workplace indicators are generally more negative than positive. Here too, labour views are significantly more negative.

These differing perceptions, presumably drawn from the same sets of labour/management relationships, are cause for concern. Further exploration of the sources of these differences is important. Since the survey was conducted, developments in several jurisdictions may have worsened relations further.

Overall, the survey results suggest that there are issues and approaches which offer the potential for dialogue and agreement on common approaches among the constituencies. It is also important, however, for all parties to be very aware of the impacts of poor labour/management relations and of the potential for further difficulties in this area.

The Canadian economy is facing many challenges. Continuing high unemployment, increased competitive pressures, and painful government fiscal adjustments are only three of the serious issues which must be addressed at the national level. Business and labour perspectives on many of these issues, and on ways to address them, are markedly similar in some cases, and markedly different in others.

These primarily economic issues, often accompanied by political developments, have led to deteriorating labour/management relations in many parts of Canada. As an independent organization which seeks to improve the dialogue between labour and business in Canada, the CLMPC has viewed these developments with concern.

Accordingly, the Centre conducted this survey of about 1500 leaders from the business, labour and public sector (education, health, and government) communities to determine their perspectives on a range of issues related to:

>	challenges facing the economy and potential directions for solution
>	the current state of labour/management relations in Canada
>	workplace practices and alternative working arrangements

The survey received a 31% response rate, reflected by significant response rates within the individual constituencies. This clearly indicates a strong interest by leaders across the economic spectrum in the issues raised by the survey.

This report summarizes the survey's key findings on the challenges facing the economy and the current state of labour/management relations in Canada. An analysis of the survey findings on workplace practices and alternative working arrangements will be issued in the Spring of 1997 as part of the report of the CLMPC Task Force on Alternative Working Arrangements and Changes in Working Time.

In early 1996, the CLMPC mailed 1492 survey questionnaires to business, labour and public sector leaders. The questionnaires were identical in content. By the end of March, 468 responses had been received, for an overall response rate of 31%. The mailings, responses, and response rates for individual constituencies were as follows:

Business leaders:	735 sent;	212 returned;	29% response rate
Labour leaders:	461 sent;	136 returned;	29% response rate
Public Sector leaders:	296 sent;	120 returned;	40% response rate

The intent of the survey was to identify the perspectives of opinion leaders from each constituency. Accordingly, respondents to the survey were identified as leaders rather than being drawn randomly from databases. For individual constituencies, the identification of respondents was as follows:

Business: Questionnaires were sent to lists of individuals provided by the Canadian Chamber of Commerce, The Canadian Manufacturers' Association, and the Canadian Construction Association. Each association list included its Board of Directors together with a selection of CEOs or Vice-Presidents of other important member companies. Regional representation was assured either directly through the member company selection criteria, or through use of the directors of associations' regional/provincial divisions, where they existed, or both.

Labour: Questionnaires were sent to the executive officers of the Canadian Labour Congress, its affiliates, all provincial federations of labour, and major district labour councils. Questionnaires for the Canadian Federation of Labour were distributed through the CFL national office to its affiliates.

Public Sector: Questionnaires were sent to the presidents of Canadian universities and community colleges, the Board of Directors of the Canadian Health Association, and senior federal and provincial government officials at the Deputy Minister/Assistant Deputy Minister level, with responsibility for employment, labour, or labour market matters.

Respondents were asked to rate the seriousness of a number of national-level issues facing the economy. While they displayed a full spectrum of responses, priority issues were common among constituencies. Even where there were differences, these differences were often of degree, rather than reflecting completely opposed sets of priority issues. Broadly speaking, public sector leaders' responses fell in the mid-ground between those of labour and business leaders.

Recognizing that leaders' responses fell on a continuum, the analysis which follows groups the responses into two broad categories: issues of common concern to the three constituencies, and issues of different priority to the three constituencies.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issues of Common Concern to Business, Labour, and Public Sector Leaders (Figure 1a)

Issues Considered Very Important - Several issues were identified as 'serious' by 45% or more of each constituency.

Lack of jobs is the issue on which there was by far the strongest consensus among leaders in the three communities. (The issue was ranked as serious by 99% of labour leaders, 89% of public sector leaders, and 71% of business leaders.)

Lack of a national consensus on economic priorities ranked second among the major issues on which there was substantial business/labour/public sector consensus. Approximately six out of ten leaders in each community identified this as a serious issue.

Uncertainties regarding national unity ranked high among business and public sector leaders (71% and 68%, respectively, regarded the issue as serious). Among labour leaders, half viewed the issue as serious.

High taxes were viewed as a serious issue by three quarters of business leaders and about half the union and public sector leaders.

While leaders from all three communities identified a lack of national consensus on economic priorities as a serious issue, all three agreed that lack of jobs is an area of high national priority.

Issues Considered Moderately Important
There was broad consensus among the three constituencies that the following five issues were of moderate overall importance as challenges facing the economy. Among these, the first two were generally rated as more serious than the last three.

>	inadequate investment (viewed as serious by between 39% and 52% of all three communities)
>	international competitiveness (seen as serious by between 41% and 59% of all three communities)
>	lack of capital for small business (seen as serious by about 30% of each community)
>	lack of innovation (seen as serious by about 30% of each community)
>	shortage of skilled labour (seen as serious by between 27% and 36% of all three communities)

A sixth issue - the quality of education - was viewed differently by labour and business leaders on the one hand, and by public sector leaders on the other. While a significant percentage of labour and business respondents saw the quality of education as a serious issue (49% for labour; 41% for business) only 27% of public sector respondents (many of whom were drawn from the post-secondary education sector) viewed it as serious.

Such different points of view on whether the quality of education is an issue at all are worth exploring further. Given these differences, it may not be surprising that public - private sector dialogue on how to approach education issues has, in many jurisdictions, been difficult.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issues of Differing Priority to Business, Labour and Public Sector Leaders (Figure 1b)

The survey also identified a number of issues on which leaders of the three constituencies placed different priorities. Many of these differences were differences of degree, rather than completely polarized perceptions.

Issues More Serious for Business than for Labour

The most significant difference of view was with respect to government deficits and debts. For business leaders, this was the single most serious issue identified (reported as serious by 92%). On the labour side, although many recognized it as an issue, the percentage was considerably lower (38%). For labour, this issue ranked twelfth among the eighteen issues listed.

Similarly, government regulation was perceived as serious by more business respondents (54%) than labour respondents (28%). For both, however, the issue was perceived as less serious than government deficits and debts.

Other issues perceived as more serious by business than by labour include Canada's poor productivity performance (business 28%; labour 7%) and high labour costs (business 29%; labour 5%).

On all three issues, public sector leaders' perceptions of the degree of seriousness fell between those of labour and business leaders.

Issues More Serious for Labour than for Business

The quality of workplace training was reported as a serious issue by 58% of labour leaders but by only 27% of business leaders and 31% of public sector leaders.

The issue of environmental degradation showed an even greater spread between labour and business perceptions. A significant 54% of labour respondents viewed this as a serious problem versus only 24% of public sector leaders and 11% of business respondents. For labour, it was fourth in importance among the eighteen issues listed; for business respondents it was the least frequently mentioned.

Poor labour-management relations were also of much greater concern to labour leaders than to business leaders. An overall 47% of labour respondents identified this as a serious issue as opposed to only 19% of public sector respondents and 18% of business respondents. While labour leaders ranked this as eighth out of eighteen issues in order of importance, business leaders ranked it seventeenth.

Finally, a much higher proportion of labour leaders than of public sector and business leaders identified high interest rates as a serious issue (51% labour versus 23% public sector and 22% business).

Addressing Differing Priorities

While there are many areas which labour, business and public sector leaders agree are serious issues, there are others where their perceptions clearly differ. In many cases, such as government deficits, regulation, or interest rates, these reflect different perceptions of public policy priorities and the role of governments in the economy and in society. As such, they are arguably more difficult for labour and business to reach consensus on.

Given the significant impact of public policy in these areas, however, and the common perception among business and labour leaders that lack of a national consensus on economic priorities is a serious problem, it is important that continuing efforts be made to bridge the gap between labour and business on these issues.

On other issues, including training, labour-management relations, productivity performance, and, to some extent, the environment, there are strong workplace aspects. This suggests that dialogue between the constituencies can proceed more easily at the workplace level as well as at other levels. The issue of labour costs, in unionized workplaces, is dealt with through collective bargaining.

Grouping potential solutions would be hazardous and judgemental since respondents' views fell along a full continuum. With this caution in mind, the analysis which follows has sorted the responses according to the degree to which the constituency leaders appeared to share perspectives on potential solutions.

 

 

 

 

 

 

 

 

 

 

Common Perspectives on Solutions (Figure 2a)

Respondents were asked what emphasis should be given to a series of potential solutions to particular economic problems. Not surprisingly, there was a strong relationship between their identification of specific serious problems, discussed above, and their preference for certain solutions. Again, the three constituencies broadly agreed on certain solutions and differed, in varying degrees, on others. This section describes the areas where the parties shared common perspectives on solutions.

There was considerable agreement among all leaders that improved education, increased R&D, and improved workplace training need more emphasis to address the issues facing the Canadian economy.

>	Sixty-five percent of the business leaders feel there is need for more emphasis on education, while 59% stress R&D and 52% stress increased training. It is interesting that, although only 27% of business respondents shared the view that the quality of training is a serious problem, the majority support more emphasis on training and education.
>	At the top of the agenda for labour leaders was the need for more emphasis on training (88%) and education (75%). Many labour leaders also support more emphasis on R&D (67%) in efforts to address current economic problems.
>	Public sector leaders also placed top priority on training (79%), education (71%), and R&D (70%).

In addition, approximately half of the leaders from all three groups identified improved access to capital for small business and improved access to foreign markets as areas for further emphasis.

It is noteworthy that, with the exception of improved workplace training, all of the above areas of consensus on solutions address issues which respondents from all three communities identified as being of intermediate importance in the preceding section. Agreement on issues contributes to agreement on areas for solution. 

Differing Perspectives on Solutions (Figure 2b)

There were different perspectives between leaders regarding those solutions which should be given more emphasis. While these differences varied in degree, in some cases they were quite marked. With a few exceptions, the priority given by public sector respondents to individual solutions fell between those of labour and business.

Strong Differences of Emphasis

The large majority of business leaders identified reduced government spending and reduced regulation as approaches needing greater emphasis. In sharp contrast, these solutions ranked last among labour leaders. The proportion of business and labour respondents who indicated a need for greater stress in these areas were as follows:

>	reduced government spending - business 91%; labour 32%
>	reduced regulation - business 76%; labour 32%

In each case, the public sector proportions fell between those of labour and business.

Similarly, labour respondents placed a significantly higher emphasis (60%) on lowering interest rates than did business respondents (25%). Public sector responses (31%) again fell between those of labour and business.

Moderate Differences of Emphasis

Among labour leaders, there was solid support for greater emphasis on improving labour-management relations (68%) and promoting alternate working arrangements (52%). These solutions were viewed as lower priorities by 40% of business leaders. The public sector respondents indicated greatest support (62%) for increased priority in promoting alternative work arrangements.

In the case of lower taxes, 81% of business respondents sought increased priority while only 47% of labour respondents did so.

It is interesting to note that the areas where there are the greatest labour-business differences in priorities - government spending, taxes, regulation and interest rates - are all amenable primarily to government solutions. In contrast, two areas where the differences are more moderate - promoting alternate work arrangements and improving labour-management relations - are areas where there is a significant workplace component.

Respondents were asked to rate their perception of the current state of labour/management relations in Canada, how this has changed over the past two years, and what impacts these changes have had on the workplace. They were also given an opportunity to comment on the main factors which have affected labour/management relations in the recent past.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current State of Labour-Management Relations (Figure 3)

There is a widespread view at the national level that labour-management relations are currently poor or very poor The great majority of labour respondents (75%), and many business and public sector respondents (40% and 46%, respectively) hold this view.

The gap between labour leaders and others is even more striking when the proportions responding "very poor" are looked at alone. Here, 44% of labour leaders identified labour/management relations as "very poor", as compared to only 9% of business leaders and 8% of public sector leaders.

Interestingly, the perceptions of all three communities on the current state of labour-management relations at the industry level are less negative than at the national level, and less negative still at the workplace level. To illustrate, the proportions of business, public sector and labour respondents citing labour/management relations as poor or very poor at the industry and company levels, respectively, are as follows:

>	business - 17% and 10%
>	public sector - 48% and 25%
>	labour - 61% and 54%

Significantly, for labour, the negative view remains the majority view regardless of level, while it is a minority view for business and public sector leaders at all levels. There is a clear dichotomy in the various parties' attitude to their relationships with each other; labour dissatisfaction is not reflected by other parties.

These differences are clearly a matter of concern requiring discussion and further exploration by all involved. While labour attitudes are possibly being either miscommunicated or misinterpreted, an alternative explanation may be that labour/management relations may figure more prominently on the agendas of labour than of management, who at the workplace also have to deal with customers, suppliers, financers, and regulators.

The increasingly negative attitudes at higher levels of aggregation are noteworthy. They may be explained in large measure by the existence of strong public policy differences among the parties, which has resulted in confrontations and strikes in some provinces. In contrast, problem solving may be less complicated at the workplace level, fed by a sense that the concerns of labour and management overlap to a greater degree and that solutions to problems are more within the parties' direct control.

Nevertheless, for labour more than for other constituencies, there may be a linkage, or spillover, between national-level issues and those at other levels. This may contribute to the more negative labour views at all levels.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in Labour-Management Relations (Figure 4)

Perspectives on the change in labour/management relations over the last two years reflect very closely the leaders' views of the current state of labour/management relations described above. Specifically:

>	abour leaders' views are significantly more negative at all levels than those of business or public sector leaders; and
>	the views of all leaders become less negative as they move from the national to the industry and workplace levels.

The detailed findings indicate that 61% of the responding labour leaders feel that labour-management relations at the national level have worsened in the last two years. This view is shared by only 26% of business leaders and 40% of public sector leaders.

As the frame of reference moves to the industry and company level, the proportions of respondents who feel that relationships have worsened for the most part decreases, as follows:

>	labour - 50% and 48%
>	public sector - 49% and 31%
>	business - 11% and 12%

It is noteworthy that, among the public sector leaders, the view is that labour/management relationships have worsened more in the public sector itself than in the economy as a whole. This clearly reflects the effects of widespread public sector restructuring efforts, which have been particularly contentious in some jurisdictions.

The gap in perspective between business and labour leaders is a point of concern. It is most evident at the company level where almost half (48%) of labour respondents but only 12% of business respondents feel that relationships have worsened over the last two years. Almost half (48%) of business leaders but only 25% of labour leaders feel relationships have improved. These significant differences of view regarding the same set of relationships raise concerns about the effectiveness of communication between the parties in many workplaces.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Effects of Labour-Management Relations (Figures 5a, b, c)

The overall effect of current labour-management relations on most aspects of the workplace is seen as more negative than positive by the leaders of the three communities. Labour leaders' views are the most negative, followed by those of public sector and then business leaders.

More particularly, the number of leaders who feel that the current state of labour-management relations has negative effects in their industry in almost all cases exceeds the number who feel that it has positive effects. This is particularly true with respect to the following workplace aspects, for which the constituencies' negative (and positive) impact assessments are also listed:

>	employee morale - labour 74% (14%); business 38% (31%); public sector 77% (13%)
>	job security- labour 68% (15%); business 35% (22%); public sector 58% (18%)
>	job creation - labour 59% (13%); business 33% (15%); public sector 48% (7%)
>	investment - labour 40% (13%); business 29% (23%); public sector 30% (4%)
>	costs and productivity - labour 58% (26%); business 38% (35%); public sector 65% (15%)

Opinions were mixed on the impacts of labour/management relations on quality, innovation and turnover. In each case, business leaders saw the positive effects outweighing the negative effects, while labour and public sector leaders viewed the negative effects as the more significant of the two.

Training deserves special mention. Business leaders felt that the effects of current labour-management relations on training were more positive rather than negative. Among labour and public sector leaders, negative views continued to exceed positive views. However, all three parties came close to agreeing that training received positive effects from labour/management relations. It therefore may represent a potential issue around which future positive labour/management initiatives may be built.

Factors Affecting Labour-Management Relations (Figure 6)

There is a significant contrast of views on the main factors affecting labour-management relations.

Among business leaders, the current state of the economy is most frequently cited (34%) as an important factor affecting labour-management relations. In related fashion, downsizing and the resulting job insecurity were also separately cited, especially by labour respondents, as affecting labour/management relations.

Among labour leaders, however, the state of the economy was the least frequently given reason (4%) for the current state of labour-management relations. Instead, the most frequently given reason (38%) was the lack of trust and poor communications between the parties. Significantly, this view was also supported by many business leaders, for whom this factor was cited second in order of frequency (21%).

Many union leaders (20%) also made reference to changes in labour legislation and public sector labour disputes as factors contributing to the current poor state of labour/management relations. Among public sector leaders, the factor that was mentioned far more often than any other in this regard (38%) was government cut-backs.

Other factors cited less frequently included wages and benefits, contracting out, and comments from some business and public sector respondents concerning their perceptions of union views on some issues.

In summary, business and labour agree that a predominant problem in labour-management relations is the lack of adequate communications between the parties. This is an issue which is within their power to address. Beyond that, its manifestations in the form of downsizing and insecurity may warrant increased management-labour dialogue.

The Canadian economy faces serious issues. The perceptions of business, labour, and public sector leaders regarding these issues cover a broad spectrum. In many cases, leaders from all three communities share common priorities, as in their stated concerns over lack of jobs, lack of consensus on economic priorities, uncertainty regarding national unity, and high taxes. In other cases, priorities differ, although these differences are usually differences of degree rather than completely polarized perceptions. For example, government deficits and regulations rank high on business agendas but low on those of union leaders. For labour, issues of training, interest rates, environmental degradation and labour-management relations are among the most important, although these are lower priorities for the business and public sector communities.

The three communities clearly have common perceptions and potential solutions concerning some issues, and differing ones regarding others. On the one hand, business respondents stress reducing government spending and regulations, while priority for these approaches ranks last among labour leaders. Labour emphasizes lowering interest rates, while this is a much lower priority for business. There is widespread support among all communities for more emphasis on education, training and R&D, greater availability of capital for small business, and better access to foreign markets. There is also room for discussion on improving labour-management relations and promoting alternative working arrangements.

There is a widespread view among all constituencies, although held most strongly by labour, that labour/management relations in Canada are poor at the national level while somewhat better at the industry and workplace levels. Labour leaders, more than business or public sector leaders, feel that relations between management and labour have deteriorated during the last two years. Respondents from all constituencies, however, agree that at present, the negative impacts of labour-management relations on many aspects of the workplace seem to outweigh their positive impacts. The result may be that workplace performance is being impeded.

Training deserves special mention. Since this is the subject on which all three constituencies came closest to agreeing on a positive labour/management relations impact, training initiatives may provide future opportunities for further joint action.

>From the perspective of labour and business, many of the areas for solution rest with government, through the public policy process. In the area of labour/management relations, where labour and management are clearly the dominant actors, the survey has shown both the need for improvement and some readiness to address this question.