Unifor accuses the Bank of Canada of ignoring the real cause of inflation

A person holding Canadian money sitting at a desk with bills and a laptop. Picture submitted by CNW Group and Unifor

Unifor has warned Wednesday’s quarter-point interest rate hike from the Bank of Canada unfairly puts worker’s jobs in jeopardy while ignoring the actual cause of price increases.

The Bank of Canada hiked its key overnight lending rate for the eighth straight time, up a quarter point to 4.5 per cent.

Although the Bank said previous hikes have been slowing inflation by hitting consumer demand, the Bank pointed to continued high inflation to justify the increase.

“The Bank’s stubborn and aggressive rate increases are already having an impact on the economy contributing to increased costs for working families while at the same time corporate profiteering has been given a free pass,” said Unifor National President Lana Payne. “Workers jobs and incomes are at stake here. It’s time to stop the rate hikes before the economy is pushed into a deep recession.”

According to Unifor, wage growth failed to keep up with inflation last year, but corporate profits soared. Unifor said inflation was 6.3 per cent between December of 2021 and December of 2022, while wages rose 5.1 per cent. In the third quarter of 20222, those profits were more than 20 per cent of GDP, up from the 15 per cent average in the five years before the pandemic.

“At the last rate hike, the Bank of Canada Governor pointedly stated the next rate decision would be data driven. The data clearly shows that inflation is slowing and that sources, namely supply chain bottlenecks and soaring gas prices, are easing,” Payne said. “The Bank of Canada remains hell-bent on its recession creating strategy to stifle wages, putting the onus on workers while continuing to ignore blatant corporate profiteering.Corporations are taking advantage of inflation hysteria, using it as cover to increase profit margins and extract even more of workers’ hard-earned cash.”

Unifor wants the federal government to address corporate profiteering with an expanded excess profits tax, while preparing for the potential recession by fixing Employment Insurance.