Millennials’ future in the working world

Photo by Nicole O'Brien

Chris Matthews and Samantha Francis are assembly line partners at the Oshawa plant.Both agree they feel job security at GM is weak for the young generation.

Chris Matthews, an assembly line worker at General Motors in Oshawa, checked the “yes” box when he voted on the deal struck between the Canadian union Unifor and the automotive giant last month, though he admits he doesn’t feel it will change how he feels about his job security.

“There’s talk about (the job) being long term, but the reality of it in this industry, you could be pulled out tomorrow,” says Matthews who at 21 has been working at the GM Oshawa plant since 2014.

Matthews’ job security was tested in mid-September during GM’s negotiations with the Canadian union Unifor. Both had to agree on a new contract for its workers.

His assembly line partner, Samantha Francis, thought the plant was on its way out of Oshawa.

“I thought it was going down to be honest,” says Francis, who left the retail industry for GM after yearning for a better hourly pay than minimum wage.

Francis says the worst part was not knowing right up until the very last minute.

Unifor, which represents around 4,000 workers at GM plants in Ontario, struck a new four-year deal with GM just after the midnight deadline on Sept., 19th.

Positive changes to the deal include a commitment for Oshawa’s flex line with a $400 million investment, increased wages for employees, and better pension security for long time employees. This is great news for Oshawa, as GM has been the city’s largest employer since it opened in 1907.

“From all the small jobs its provides, all the imports. It brings all kinds of things into Oshawa,” says Matthews.

But not everyone will be happy with the new contract, especially those just hired and those looking to apply.

The deal is indicative of what millennials have to look forward too: a future with little job security. This is the future of the millennial generation, a term used to describe those born between the early 1980s and to the early 2000s.

“In the older generations, you know if you started at General Motors, there was always this car, and this car, and that wasn’t going anywhere,” Matthews, a Durham College Electrical Techniques graduate, explains.

“The place used to have 20, 000 workers, and now it’s down to too 3,000,” says Matthews.

This leaves a growing pool of well-qualified twenty-somethings scrapping it out for a limited number of positions.

GM announced all new employees will be switched to a defined contribution pension plan while longtime workers, those who have been there for 11 years or more, will remain under the defined benefit pension plan.

Jenn Cowie has been an assembly line worker at GM in Oshawa for 14 years. She says the deal has caused a split between the hires and the long-time workers.

“It’s created another division,” says Cowie. “Maybe not with status but with wage.”

“The pension is what stands out to me,” says Francis, who at 23 has just passed her one-year mark at the plant in April.

This may be because General Motors has become like many employers in Canada. By cutting back pension benefits to compete with the globalized markets, new employees face shriveling pensions.

While pension plans for long time workers and new hires may sound the same, they couldn’t be more different.

These pensions are considered Ontario’s two main occupational pension plans.

From the perspective of an employee, the defined contribution plan is superior. This plan promises to pay a certain annual retirement income for life and is based on a formula that usually considers earnings and years of service with the employer. Both the employer and employee contribute to the plan and if there is a shortfall in the money needed, the employer would be the one to pay up.

Cowie falls under the defined contribution plan and was not personally affected by the deal. She says General Motors doesn’t care about its workers. They just know workers need to make money.

“Unfortunately it is hard to find work,” says Cowie, who has also worked for Chrysler and Ford. “It’s not people’s dream job. But it’s a money trap, that is what keeps people there.”

But new hires at GM will not have the luxury of a defined contribution pension plan.

In this plan, contributions are still guaranteed, but retirement income is not. Like an RRSP, the employee is responsible for investing all contributions to grow savings. Unfortunately for new employees at GM, the amount available at retirement depends completely on the total contributions made to the account and the investment returns the money earned.

While new hires will see a slight increase in wages on their pay cheques, they will have to work a lot longer than they thought in order for their wage levels to increase to what the long-term employees are getting.

This directly affects young workers like Matthews and Francis.

“It went in one direction for new hires, new people within the last two, three years where we are starting at zero. One direction for someone who has ten years and now they’re working another ten years to be able to get where they want. And for people with like fifteen years it’s pretty much stayed the same for them,” says Matthews.

According to the new deal, Matthews will have to work another eleven years to be able to get on the same level as those receiving the defined benefits plan and he will have to work a total of thirteen years before he finishes his probationary period.

While some say the deal is completely screwing over the young workers just starting out, others, like Clair Cornish, program coordinator of both the Trades Fundamental program and the Mechanical Technician program at Durham College, believe millennials shouldn’t give up on the trades.

“The trades are a wonderful opportunity for our Ontario youth to find rewarding careers that are good paying jobs and have a lot of self-satisfaction,” says Cornish, who also teaches in both the programs he coordinates.

According to the Ontario Youth Apprenticeship Program, 40 per cent of all occupations by 2025 will be skilled trades in fields such as construction, mechanics, engineering, and more.

Along with Matthews, Francis also voted yes at the ratification held the weekend after the contract was agreed upon. One thing they didn’t vote on: job security.

“I think it’s better than working at other places,” says Matthews.

Francis looks at her friend reluctantly and says, “But do you feel secure though?”

Almost at the exact same time, both reply, “No.”

According to a 2016 report from the Royal Bank of Canada, millennials are doing better than ever. Canadian millennials have “inherited a labour environment in many ways better than that of their parents.”

More millennial women are participating in the workforce compared to previous generations, and they hold a majority of degrees in science and technology, according to the report written by RBC economist Laura Cooper.

And while that is great news, the report left out other information which suggests the economy is much tougher on millennials than it was on their parents. The report skimmed over important issues such as weak job security and the cost of housing.

According to Statistics Canada, millennials are facing an unemployment rate of 13.3 per cent. Not only are their fewer jobs for young people, but job security is very weak.

Cooper also suggests that in 2015 there was a rise in contract employment for millennials, which accounted for 12.8 per cent of all youth employment. But growing contract employment is just another way of saying job security for the younger generation is very weak in Canada.

The report shows contracts are often all that is offered. General Motors proves this, as they only negotiate contracts lasting for a four-year period.

In 2013, 42 per cent of Canadians aged 20 to 29 reported they were still living at home. Housing prices in Canada has caused a major struggle for millennials who want to leave the house and put down their roots.

“The cost of living keeps rising and wages don’t,” says Cowie.

The average price of a detached home in Toronto is nearly $1.2 million, and semi-detached costs more than $800 000. About 71.4 per cent of household is needed to cover the cost of the average family in the GTA. And that doesn’t stop when it comes to housing in Durham Region.

According to the Durham Region Association of Realtors, prices were up in Durham by 15.8 per cent compared to last year.

The strong combination of the lack of jobs and rising housing prices is discouraging millions of prospects from the millennial generation across Canada.

In early October, the Oshawa GM plant announced they will be hiring over 100 new employees for early 2017. But Matthews says he wouldn’t recommend anyone he knows to apply any time soon.

“I wouldn’t tell someone who has a decent job to leave that job to come here, not a chance,” says Matthews.

 

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Nicole O'Brien is a second year journalist student at Durham College. She enjoys writing about the campus, entertainment and sports for The Chronicle. Her work can also be seen on her entertainment blog, www.entertainmentgirl.wordpress.com and also on the lifestyle blog Godigio. In her spare time, Nicole enjoys watching movies and listening to music. She hopes to one day work for an entertainment news network on either radio or television.

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