What Canadians Need to Know About the Potential Impact of a Predicted Rail Strike
Canada is preparing for potential rail strikes this week as workers at the primary railways may go on strike or face lockouts by their employers. A prolonged shutdown could have devastating effects on the industry and consumers who may experience product shortages and higher prices. However, an economist suggests that the impact on the average Canadian could be minimized as the government is unlikely to permit a lengthy strike.
Both Canadian National Railway Co. and Canadian Pacific Kansas City Ltd. (CPCK) are at risk of a work stoppage on Aug. 22 if they fail to reach agreements with their employees represented by the Teamsters Canada Rail Conference (TCRC).
Director for British Columbia and Western Economic Policy at the Canadian Federation of Independent Business (CFIB), Jairo Yunis, mentioned that certain goods movement has already slowed down due to embargoes taking effect.
John Corey, president of the Freight Management Association of Canada, echoed this sentiment by explaining that supply chains take a week to recover from just a single day of a railway strike.
While concerns have been raised by business and agriculture groups about the negative impact of a strike on the Canadian economy, economist Moshe Lander believes that a prolonged strike is unlikely given government intervention.
Federal Labour Minister Steven MacKinnon has urged both parties to intensify negotiations to avoid a full work stoppage, with the authority to mandate binding arbitration if necessary.
Strike Length
Lander predicts that the impact on the average consumer would be minimal in the short term, but the agriculture sector could face more significant challenges due to their reliance on rail transport.
Impact on Prices
Lander explains that a prolonged strike would lead to higher prices and goods scarcity, impacting consumers and businesses. Alternative transportation methods may result in increased costs for businesses and delays for consumers.
Impact on Commuters
In the event of a strike, commuter lines like the Go train transit system in Ontario could be affected, leaving workers without a reliable travel option. This could impact workers who are unable to work remotely and industries that rely on in-person services.
Long-term Impact
Farmers are expected to be among the hardest hit by a rail shutdown, particularly in Western Canada where agriculture heavily relies on rail transportation. The potential losses could be substantial, especially during the harvest season.
