The World Happiness Report: Where does Canada stack up and why?

There's long been an argument made that you can directly tie the collapse of the middle class to the decrease in union density and a batch of recently released statistics certainly support that idea.

Early in September, the US Census Bureau released their numbers on income. The results were typically grim, with the middle class continuing to shrink and more money headed to the top five per cent of wage earners (at this point I would normally link you to the census reports, but much like the rest of the US government the census website is shut down for the time being).

But an interesting correlation between union density and income appeared. The Center for American Action Fund, a Washington D.C. based educational and policy organization, took a look at the numbers and found that as the middle class’s share of income shrinks, union density goes down.

Between 1968 the middle class took just over 50 per cent of all income, while union density sat at 28.3 per cent. In 2012, the middle took home 45.7 per cent of income while union density sat at 11.3 per cent.

What they are of course recording is the loss of steady, well-paid unionized work most likely found in manufacturing, which has seen a major decline all across the US.

And what of countries that have high levels of union density?

Several Scandinavian and western European nations have union density rates above 70 per cent. Over at the Law of Work, David Doorey found that Denmark and Norway, the top two nation's on this year's World Happiness Report (a UN report that ranks quality of life worldwide), have high rates of workers covered by collective agreements -- 80 per cent and 70 per cent respectively.

The top ten breaks down a little like this:

The outliers?

Canada and Australia, both under 50 per cent.

Critics might say this is proof that quality of life is not necessarily tied to unionization. True enough, their ranking could be explained by a number of other factors. However, one of those factors is likely access to social services like Medicare.

Canada also benefits, on the federal and provincial level, from stronger and better-enforced employment legislation compared to nations further down the ranking.

The other factor to consider is that in Canada, union density has held comparatively steady since 1967, though the ratio between male and female members has evened out as more women enter the workforce. In 1967 union density was 33.2 per cent.

In 1997 union density was actually slightly higher -- 33.7 per cent. Between 1997 and 2012 the drop was only about two per cent to 31.5.

What this means is that while Canada certainly faces challenges regarding income disparity, overall we've managed to keep a steady rate of unionization, and therefore have retained a steady number of jobs that keep people in the middle class.

It certainly helps explain how Canada manages to keep its position in the Happiness Report.

Image: flickr/Alex Pepperhill

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