The wage gap between unionized and non-unionized workers in Canada has narrowed to about 10%, roughly half what it was a decade ago, according to a new report from the House of Commons human resources committee.Blacklock's Reporter says drawing on data from Statistics Canada, MPs found union workers now earn an average of $37 per hour compared to $34 for their non-union counterparts. A decade ago, the wage disparity stood closer to 20%.“The wage disparity between unionized and non-unionized workers, although still present, is declining,” said the committee’s report, Compensation Disparities Between Unionized And Non-Unionized Workers In Canada.MPs credited part of the convergence to what witnesses described as a “union threat effect,” where the possibility of unionization pressures private sector employers to raise wages and improve working conditions to discourage organizing drives.“The committee heard about the positive effects of unions on the wages and working conditions of non-unionized workers,” the report stated, noting employers may enhance pay and benefits to boost recruitment and retention.Union representation remains uneven across sectors. .About 15% of private sector employees are unionized compared to 76% in the public sector. Regional disparities are also significant. Québec had the highest union coverage rate in 2025 at 39%, while Alberta ranked lowest at 24%.Despite the recent narrowing of wage differences, overall unionization has declined sharply since 1981, when 38% of Canadian workers were covered by collective agreements. Today that figure stands at roughly 31%.In a separate 2024 analysis, Statistics Canada attributed much of the long-term decline to the collapse of manufacturing employment. The manufacturing sector accounted for the largest drop in collective bargaining coverage in the private sector over the past quarter century.Between 2001 and 2017, Canada lost an estimated 495,300 manufacturing jobs. A 2013 Statistics Canada report noted that for the first time in Canadian history, more Canadians worked in retail than in factories.The erosion of traditional private sector union strongholds has also reshaped workplace benefits. During 2023 Senate banking committee hearings on changes to the Bankruptcy and Insolvency Act, Michael Powell, president of the Canadian Federation of Pensions, testified that defined benefit pension plans — once common in unionized workplaces — have largely disappeared.“They have been disappearing for 20 years,” Powell said. “My kids don’t see themselves working for the same company for 30 years. I worked for General Motors for 34 years. That doesn’t happen.”
