s wage controls were relaxed in the late 1970s, more daunting problems appeared on the horizon. A shift toward more conservative economic attitudes begun around the time of the implementation of wage controls was now in full swing. Conservative commentators attacked the size of government and expenditures. Every aspect of government regulation and spending came under attack. This included such diverse targets as the size of the state workforce and funding for education, medical, and social assistance programs. In other words, demands were being made to dismantle programs labour considered fundamental to a just society.

This critique was quickly extended to the labour movement. Public sector unions became the focus of much of this criticism. Governments painted them as obstructionist, slow to change, and insisted that their demands for job protection and reliable incomes provided evidence of selfishness in a time of economic crisis. The federal and provincial governments launched strenuous campaigns against their employees' unions. Legislation reversed union's collective bargaining rights and, in some instances, completely suspended them. Public sector workers experienced extensive government imposed controls on their incomes and benefits. Many jobs were cut and others contracted out to non-union employers who paid lower wages and provided minimum benefits.

Private-sector employers pressed for many of these changes in negotiations with their own employees. They demanded from unions concessions on wages, benefits, and work rules. A "flexible" workforce became a key issue when management and workers sat across the bargaining table from one another. Company officials demanded the right to ignore job classifications and seniority clauses in contracts in order to reduce labour costs and increase productivity. Threats of layoffs and "downsizing," another catch phrase of the 1980s, made worried workers concede to such demands. The practice of downsizing (laying off workers and reorganizing work, often with the aid of technology, to increase productivity) meant the permanent loss of thousands of quality manufacturing jobs. The unemployment situation worsened further when downsizing combined with a general economic recession in the early 1980s or with the much more serious depression of the 1990s.

The relentless pressure on unions from governments, the mass media, and corporations left the labour movement reeling. Downsizing and other layoffs brought a significant decline in union membership in the traditionally well-organized mass-production and resource industries. Canada's major railroads alone cut thousands of positions. In the United States, a similar pattern of events reduced union membership as low as 11 per cent of all wage earners. Declines in Canada proved not to be as precipitous, primarily because of a more effectively organized public-service sector. However, the declines were sharp enough for media "experts" to predict the total collapse of the labour movement.

Labour put new energy into electoral politics and was rewarded with success in provincial politics. New Democratic Party (NDP) governments held power for varying amounts of time in British Columbia, Saskatchewan, Manitoba, and Ontario. In Quebec, the Parti Québécois government's social policies paralleled those of the NDP elsewhere. On the whole, these governments proved sympathetic to labour. Improvements in health and safety legislation offered workers more on the job protection and other measures strengthened labour bargaining position in first contract negotiations. However, intense differences sometimes arose between labour and NDP governments over deficit-reduction programs, especially those effecting health and social assistance.