Slashing and Burning

The mid-1970s ushered in the first era of post-war government spending restraint. As oil prices rose steadily and inflation ballooned, the federal government implemented wage and price controls.

In response to soaring inflation rates (12.6% in 1975 alone), the government created the Anti-Inflation Board (AIB) to try to control wages. The AIB capped wage rates at 10, 8, and 6% per year between 1974 and 1978, and all bargaining became subject to AIB approval.

High inflation rates continued into the early 1980s, averaging 11.5%, and the unemployment rate reached 11%.

Other measures included the Inflation Restraint Act (Bill 179), which limited public sector wage increases to 5%, eliminated the right to strike, and extended current collective agreements by one year — taking away the right to bargain for higher wages in that time.

1973 Wages

Inside workers earned $250 a week
Outside workers earned $170 a week ($4.25 cents an hour)