Canadian Magazine Industry News
18 May 2011,
Editorial: postal strike spells disaster for all, especially union
The Canadian Union of Postal Workers threatens to strike May 25 unless a settlement can be found in the current round of mediation between the two parties. (See Masthead stories here and here.) At the risk of stating the obvious, a postal strike would be a disaster for all parties... but especially the union.
What union hard-liners appear unable to grasp is that most mailers have options. (It should be said that many postal workers get this and aren't following the union line.) Utilities, banks, retailers, any corporation sending a bill through the mail has for years been converting customers to electronic transactions. That trend has been increasing in recent months with contests, promotions and other incentives to get consumers to switch, including surcharges for receiving print bills and statements. A strike will provide even more incentive.
Once consumers switch, they won't be coming back to mailed statements.
The same is partly true for publishers. On the invoicing and renewal side, circulators have long been working to take efforts out of the postal system and replace with emails and auto-renewals. Postal strikes will only make it more urgent to do more in this regard.
As for the magazines themselves, it gets a little trickier. The vast majority of paid-subscription magazines are delivered through the mail. But:
It's true that unlike the financial sinkhole called the United States Postal Service, Canada Post has been returning a slim profit for the last several years. But over those years, Canada Post management has been warning loud and clear that its General Motors moment is coming soon. Postal volumes and densities are declining while the post office is forced to serve an ever-growing distribution network. It doesn't add up.
Canada Post's offer seems reasonable — more than reasonable for those struggling in the private sector. Keep the existing pension program for current employees, but introduce a more affordable (but still attractive) pension program for new hires. Last year alone, Canada Post had to top up the pension fund with $425 million, much more than the annual profit.
There are other issues, of course, including the switch to a new short-term disability plan that has already been implemented for all other bargaining agents, management/exempt employees, and senior executives of Canada Post. To help the union save face and find a solution before a strike, perhaps there are one or two concessions to be made here to workers.
But CUPW has to face the fact that the future of the post office is smaller, not larger. A strike now will just speed up that transition to a smaller, weaker post office. That is not in the interests of the magazine industry, or postal workers. A settlement, or failing that, quick back-to-work legislation, is called for.
Readers can receive negotiation updates and read more at a special Canada Post web page here.
What union hard-liners appear unable to grasp is that most mailers have options. (It should be said that many postal workers get this and aren't following the union line.) Utilities, banks, retailers, any corporation sending a bill through the mail has for years been converting customers to electronic transactions. That trend has been increasing in recent months with contests, promotions and other incentives to get consumers to switch, including surcharges for receiving print bills and statements. A strike will provide even more incentive.
Once consumers switch, they won't be coming back to mailed statements.
The same is partly true for publishers. On the invoicing and renewal side, circulators have long been working to take efforts out of the postal system and replace with emails and auto-renewals. Postal strikes will only make it more urgent to do more in this regard.
As for the magazines themselves, it gets a little trickier. The vast majority of paid-subscription magazines are delivered through the mail. But:
- more and more publishers are issuing iPad editions at cheaper prices
- more publishers are switching to online-only titles, away from print
- print circulations are decreasing overall
- there is more incentive to use newsstand since single-copy sales also now count towards the Canada Periodical Fund subsidy formula
- avoiding the post office is another reason for new launches to be distributed through newspapers, through bulk distribution (controlled), or through the newsstand
It's true that unlike the financial sinkhole called the United States Postal Service, Canada Post has been returning a slim profit for the last several years. But over those years, Canada Post management has been warning loud and clear that its General Motors moment is coming soon. Postal volumes and densities are declining while the post office is forced to serve an ever-growing distribution network. It doesn't add up.
Canada Post's offer seems reasonable — more than reasonable for those struggling in the private sector. Keep the existing pension program for current employees, but introduce a more affordable (but still attractive) pension program for new hires. Last year alone, Canada Post had to top up the pension fund with $425 million, much more than the annual profit.
There are other issues, of course, including the switch to a new short-term disability plan that has already been implemented for all other bargaining agents, management/exempt employees, and senior executives of Canada Post. To help the union save face and find a solution before a strike, perhaps there are one or two concessions to be made here to workers.
But CUPW has to face the fact that the future of the post office is smaller, not larger. A strike now will just speed up that transition to a smaller, weaker post office. That is not in the interests of the magazine industry, or postal workers. A settlement, or failing that, quick back-to-work legislation, is called for.
Readers can receive negotiation updates and read more at a special Canada Post web page here.
— Staff
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| Jaded says: | |
Wow, Torstar really seems to be on a mission to bankrupt one magazine after another.... |
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| Lorene Shyba says: | |
Full of terrific information, Thanks!... |
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I'm so very tired of people who describe themselves as opposed to "big labour" as if that mythical creature were as bad as "big business." Check how corporate profits, executive pay and corporate tax breaks (which should be called what they are - giveaways of public money) have been rising through the stratosphere in the last several decades and then look at what's happened to workers' wages - real wages, i.e. actual buying power over time - over the same time period. Flat, mostly, or a slight rise or even declining. So much for the "threat" of "big labour." Open your eyes, people. Higher union wages benefit everyone.
Plus this Crown Corporation wants an insurance company to tell employees when they can be sick, sounds like privatized health care.
Yes, first class letter mail is declining, but if you've checked your mailbox lately, the mail is 70% 2nd and 3rd class mail, with flyers added to the pile. Early January 2011, Canada Post issued a statement that congratulated the employees for delivering a "RECORD" volume of one day mail.
Parcel service is on top of this.
Fed Ex recently report a "record" quarter of profit.
The increased expenses are due to the new postal machines that were bought to cut down on staffing. In almost a year of test operations, they have been slowing down service. Being short staffed is another area that is not being mentioned by the media.
Eventually Canada Post is gearing up for privatization, as in many other countries.
To sell it with the most profits, they need to cut long term costs, such as pensions and employee costs as much as possible.
Get set for major increases in postal costs in the coming years as well, no matter who wins this negotiation.
The union believes that if they create enough of a disaster, they will get their demands met much faster, believing that the money is hiding somewhere, when in reality, THE MONEY DOESN'T EXIST!!!! The union needs to face the reality and not believe in fairy tales.
As any investor knows, past performance is no guarantee of future profitability. It is time the union came to their senses with the fact that CPC is a sunset industry relative to letter mail and unless they suddenly become a force in the parcel business, future profits look slim given their high labour costs.
Thus the choice for the union becomes whether to collectively "cut their noses to spite their faces" or to rationally look at the issues. Defined benefit pension plans and 'cadillac' sick benefits are very costly even for business that have solid future profit outlooks. CPC's current offers for both issues are competetive with top flight benefit plans in both the public and private sectors. It's not quite the rollbacks that the CUPW would have one believe.
Unless this radical union comes to their senses, there may not be many jobs to return to when the competition picks up CPC's parcel business left by the strike void.