The Air Canada flight attendants’ strike seems to over as CUPE and Air Canada have struck a tentative deal. The discourse around this strike has been polarized; some have supported the strike and others have blamed the union for significant travel disruptions that are costly to Canadians.
Here is a summary of what happened:
Members of CUPE, the union representing Air Canada flight attendants, voted in favour of a strike which began August 16, 2025. In response to this, Air Canada began cancelling flights on a rolling basis, with many travellers left stranded and completely uncertain about their travel plans.
Minister of Jobs and Families Patty Hadju invoked Section 107 of the Canada Labour Code to order Air Canada employees back to work. The union responded by defying these orders, risking significant fines and jail time. They argue Air Canada’s offer of a 38% pay increase over four years still leaves attendants unpaid for critical duties like boarding and ground time. Late on August 18th, both parties reached a tentative deal which saw operations resuming Tuesday evening. The tentative agreement guarantees Air Canada flight attendants a minimum of 60 minutes of ground pay before each flight, calculated at 50% of their hourly wage, with that rate set to rise by 5% annually.
How you feel about this strike is directly related to how you feel about organized labour, but this situation reveals something much deeper about the growing class tensions in Canada. Regardless of where you place on the political spectrum, everyone should agree that wages in Canada have not kept up with the rise in prices of other goods and services. This strike reflects the larger issue of Canada having decades of economic growth that benefits capital while wages stagnate.
Wages Have Not Kept Up With Cost of Living
Wage stagnation is at the root of much of our frustration with Canada’s economic outlook. Growth in house prices, for example, has completely dwarfed wage growth, meaning homeownership is more precarious and less likely, and renters are stretched increasingly thin. The federal Housing Minister Gregor Robertson has suggested that house prices need not fall in order to improve affordability. The implies that wages must rise. Economist Mike Moffatt, PhD, has estimated it could take Canada roughly 18 years to return to 2005 levels of affordability. Therefore, such a policy would require massive investment by the federal government, and a concerted effort to raise the minimum wage and labour protections.
Most Canadian workers, whether minimum-wage or average earners, cannot afford to live in major cities where jobs are concentrated. A CCPA report shows that the “rental wage” needed for a one-bedroom apartment far exceeds both provincial minimum and median wages in nearly all urban centres. For example, workers would need $33.62/hour in Toronto and $32.36/hour in Vancouver, compared to minimum wages under $17.
If CCPA is too lefty for you, the Fraser Institute has also identified the same problem, comparing the wage situation to the US. A study finds that Canadian workers earn less than workers in every U.S. state, with the gap widening since 2010. By 2022 every Canadian province fell behind comparable U.S. states. For example, Ontario workers now earn nearly $9,000 less than their Michigan counterparts, and Albertans trail Texans by over $5,000, a state Alberta once outpaced.
This decline in relative earnings reflects weak growth policies at both federal and provincial levels. The gap threatens Canada’s competitiveness, as talent and investment may increasingly flow south, worsening the divide and risking economic stagnation, especially if U.S. trade policy turns more protectionist.
The Nuance of Foreign Workers
Immigration is complicated.
The reliance of Canadian employers on foreign worker and international student programs are contributing to wage suppression, particularly in low-wage sectors. Research shows that foreign workers accepting lower pay depress wages for others, leaving low-wage workers’ purchasing power stagnant despite reported labour shortages. Economists warn that expanding low-skilled worker programs may boost overall GDP but not GDP per capita, while discouraging productivity and investment.
Foreign workers face frequent exploitation, and undocumented workers (about 300,000–600,000) are especially vulnerable to unsafe conditions and discrimination.
Programs like the Temporary Foreign Worker Program (TFWP), which ties workers to specific employers, have ballooned in recent years. Labour Market Impact Assessments (LMIAs) were designed to ensure employers could hire for their needs if there wasn’t adequate domestic labour available, but approvals have jumped 70% since 2019 and are increasingly seen as rubber-stamped.
Similarly, the International Student Program (ISP) has blurred the line between study and work. Students were temporarily allowed to work unlimited hours during the pandemic, a policy extended until 2024 but has since reverted to its pre pandemic limit.
It is important to ensure we do not blame immigrants for our economic situation. Immigrant labour is to thank for helping Canada navigate the pandemic. Employers who deliberately pursue foreign workers as as means to pay workers less are to blame for wage depression.
Pro Union or Anti Union — Wages Are a Problem!
The Air Canada strike was never just about one group of workers. It was demonstrative of a much bigger struggle over wages, affordability, and fairness in Canada’s economy.
If wages continue to lag behind the cost of living, strikes like this one will only become more common. And unless Canada finds the political will to pursue bold wage and productivity growth, the country risks falling even further behind. As we attempt an “elbows up” approach to our economy, let’s ensure we are prioritizing higher wages for workers.
