Losses from the rail blockades of 2020 and the Vancouver port strike of 2023 show the vulnerability of our rail networks.
The newly-minted federal Labour Minister, Steve MacKinnon, used powers at his disposal to force management and striking employees at Canadian Pacific Kansas City (CPKC) and the Canadian National Railway (CN) to head to the arbitration table, but the union is pushing back and challenging the minister's decision. What has been a tense situation seems poised to continue, and the consequences for BC's resource industry could be drastic.
While some former government ministers have warned that being ordered to arbitration is not a guaranteed immediate end to the work stoppage, which began yesterday morning, it is a welcome alternative to a long-term strike that would paralyze Canada’s internal movement of goods.
Any stoppage of rail poses a serious threat to communities in British Columbia that depend on natural resources, especially forestry and mining. Thousands of workers in these sectors are affected by developments in the rail strike, not to mention the economic damages that a long strike could pose.
Forestry and mining are integral to the BC economy, contributing billions in GDP and employing tens of thousands, especially in rural areas and small towns. These industries cannot get their products to internal markets or out to export at border crossings or ports without the rail networks.
Whenever Canada’s rail networks are disrupted, the entire Canadian supply chain is ground to a partial or complete halt, leaving workers vulnerable to the economic fallout that follows.
In 2020, for example, there were months-long blockades of Canadian rail networks in support of the controversial protests staged by Wet’suwet’en hereditary chiefs opposed to the construction of the Coastal GasLink pipeline. Although not comparable in scale to the rail strike, these blockades caused significant economic losses, with the farming sector being especially hard hit.
The rail blockades caused farm products to sit in overstuffed storage facilities without reaching their intended markets, causing financial losses. Furthermore, the rail disruptions strained Canada’s internal supply chains, affecting the movement of urgently needed products and fuels like propane.
As the protests occurred in the months of January and February, the inability to ship fuels out to home and business owners was particularly harmful during the winter months. CN Rail was forced to lay off hundreds of employees, while millions of dollars in losses were incurred.
If the 2020 blockades and the 2024 rail strike prove anything, it is that no matter how booming Canada’s economy could be, it is still vulnerable to such disruptions, especially for our exports, which are dominated by natural resource products.
The stakes are high in BC, where forestry workers are already reeling from mounting mill closures and declining timber harvests. BC Council of Forest Industries Vice President and Chief Economist Kurt Niquidet warned that a prolonged strike could cause tens of millions of dollars in weekly losses for the forest products industry.
Mining is another sector that relies on rail networks. Unlike oil and gas, extracted minerals require stable rail lines to transport their products to markets.
There are broader economic harms that could be wrought by a prolonged strike. 66 percent of all products moved through the Port of Vancouver depend on rail. The province has already dealt with the impact of labour disputes last year at the Port of Vancouver, when striking longshoremen paralyzed the movement of goods in and out of Canada’s Pacific port.
However, the memory of the Vancouver port strike should come with hope as well. Despite the disruptions and threats to key BC industries, the strike was resolved. Within the new agreement, employers committed to training workers on new equipment and boosting wages to ensure the workforce remained productive and stable.
Resource Works is confident that the federal government can play a crucial role in permanently resolving the grievances that caused the rail strike in the first place. We also believe workers deserve a fair shake and get what they need from their employers to ensure a fair quality of life for them and their families.
Having brought all parties to the table for binding arbitration, hopefully, a meaningful and satisfactory new deal can be hammered out between workers and management.
The lessons from 2020 and 2023 show the damage that can be caused by disrupting our rail networks, thereby harming our ability to export our products. As former Labour Minister Lisa Raitt warned, however, going to arbitration may not end the work stoppage immediately.
Furthermore, as the arbitration will be binding, not everyone may walk away satisfied. If that is the case, future disruptions to our rail networks may happen sooner rather than later.
Geoff Russ is a writer and policy analyst in Vancouver. He is a former journalist.