The federal government has intervened to end the month-long Canada Post strike, which began on November 15. However, experts say the damage has already been done, particularly for Canadian retailers relying on postal services to fulfill holiday orders. As backlogs pile up, questions arise about whether the postal network can recover in time to salvage the all-important Christmas shopping season.
Federal Labour Minister Steven MacKinnon announced Friday that the government has asked the Canada Industrial Relations Board (CIRB) to order Canada Post employees back to work while appointing an “industrial inquiry commission.” The commission will explore pathways to a new contract agreement by May 22, 2025. In the meantime, Canada Post workers and management will operate under the terms of their previous contract, which expired nearly a year ago.
“Canadians cannot continue to bear the consequences of this impasse,” said MacKinnon. “Our priority is to restore postal services while ensuring a fair balance between the rights of workers, those of the employer, but also those of Canadians.”
While the move temporarily halts the strike, retail experts argue that Christmas has already been “wrecked” for many businesses.
A Mountain of Backlogged Deliveries
Gary Newbury, a supply chain and last-mile logistics expert, painted a grim picture of what awaits Canada Post employees as they return to work.
“They’re going back to work, but on what terms? Exactly the same as before?” Newbury questioned. “They’ll have a sheer mountain of work to get through.” He estimates that with up to 200 million letters and parcels caught in the system, the backlog could take weeks to clear.
Newbury also raised concerns about the state of Canada Post facilities. “If those buildings haven’t been looked after during the strike, there’s a risk that rats and other vermin have gotten in,” he said. “For foodstuffs and perishables trapped in the system, the devastation could be significant.”
Retailers, meanwhile, face a harsh reality. “This has ruined Christmas for retailers,” said Newbury bluntly. “Households are going to suffer, and we can look at the government, the leadership, and the union and say, ‘You caused this.’”
Too Late for Retailers?
Bruce Winder, a retail analyst and consultant, echoed Newbury’s concerns, emphasizing that the timing of the strike’s resolution offers little relief for businesses.
“It’s over for this Christmas,” Winder said. “For every day the network is down, it takes roughly five days to recover. Even if workers started on Monday, we’re looking at a month before they catch up. That pushes deliveries well into January.”
The fallout will extend beyond the immediate backlog. Winder predicts a lingering “hangover” effect, where consumers remain hesitant to rely on Canada Post for online shopping.
“Trust has been broken,” he said. “Consumers will remember this next year and may opt for alternatives like Amazon or private couriers. Canada Post’s business model is already broken, and this strike has only accelerated its decline.”
Winder also pointed to ripple effects for retailers relying on flyer distribution to promote holiday sales. “Flyers have been held up, which further impacts sales,” he added. “It’s a nightmare scenario.”
The Impact on Small Businesses
Small businesses, which often rely heavily on Canada Post for affordable shipping, have been hit especially hard. Lisa Hutcheson, retail strategist and managing partner at JC Williams Group, highlighted the struggle for independent retailers.
“It’s a very tough time of year for small businesses that really rely on Canada Post,” Hutcheson said. “While it’s great news that workers are going back, the backlog is still going to impact deliveries.”
Hutcheson noted that many small business owners have been forced to find alternative solutions, including in-person sales and other courier services, which often come at a higher cost.
“Retailers have had to pivot quickly,” she said. “Some have benefited from increased foot traffic as customers choose to shop in physical stores rather than risk delays with online orders.”
The strike has also spurred creative alternatives for gift-giving. “I had to rethink my own holiday shopping,” Hutcheson said. “For family members out east, I opted for flower deliveries instead of shipping traditional gifts and cards.”
Consumers Turn to Alternatives
The Canada Post strike has underscored the growing dominance of alternative delivery services. Major players like Amazon have seen a surge in orders due to their ability to bypass Canada Post with their private delivery networks.
“This is where companies like Amazon shine,” said Winder. “They can guarantee fast, reliable delivery, and that’s what consumers want. Next year, even more people will ask themselves, ‘Why use the post office when I can click once and have my order the next day?’”
However, the strike’s broader impacts extend beyond Canada Post’s network. Major couriers like FedEx and UPS have also reported capacity issues, with some forced to refuse new shipments due to overwhelming demand.
“It’s not like other carriers have infinite capacity,” Newbury said. “They’re already operating at full tilt, so the disruption has been felt across the entire logistics ecosystem.”
Long-Term Implications for Canada Post
The strike has sparked renewed scrutiny of Canada Post’s business model and its ability to compete in a changing marketplace. Hutcheson believes the postal service must adapt to remain relevant.
“This strike has shown that Canada Post’s model needs to be revisited,” she said. “With so much of bill delivery and communication moving online, what role does Canada Post play going forward?”
Winder, meanwhile, warned of potential political fallout. “The Conservatives may look to privatize or outsource Canada Post if they win in the spring election,” he said. “If trust in the service erodes further, the public may support those changes.”
Looking Ahead
For Canadian retailers, the end of the strike may feel like too little, too late. While some businesses will see a slight boost in physical store traffic, the long-term consequences could reshape consumer behaviour for years to come.
“This holiday season has been a wake-up call,” said Hutcheson. “Retailers will need to explore other delivery options to avoid being caught in the same situation next year.”
