“You want to see jobs being created in higher value-added areas, higher-wage employment,” says TD Bank economist Derek Burleton. “So from that perspective it does matter. It’s important.”
The proposals may sound like lefty interventionism unlikely to gain traction in an austerity-focused environment, but their proponents include such Conservatives as Senator Hugh Segal, who argues Canada’s economy can’t afford a laissez-faire approach.
“People who live beneath the poverty line are not, to use an unpleasant quote, sitting on a couch drinking beer and eating popcorn. They are, in fact, working,” he said.
“You need a basic income base to protect those people.”
The alternative, says McMaster University’s labour economics professor Don Wells, is a widening gap that begins to have a community impact.
“More and more people feel outside of society: They feel they’re not able to participate. … You begin to see the unravelling of community.”
Mr. Somerville is hopeful the wage and benefits compression, and the trend toward temporary work, is cyclical. But in the meantime, it’s a big concern.
“If we do have sliding incomes across society, it takes away from our purchasing power and can induce a negative spiral.”
Mario Garofalo has stopped looking for a job altogether: The 43-year-old was excited to interview at a new solar-panel manufacturer in the Toronto area until he realized that at the wage offered, he was better off sticking to Employment Insurance.
“It just isn’t worth it,” he said. “So many people need jobs now. And employers in manufacturing, they know it. … But that doesn’t lower the cost of living.
“They wouldn’t be able to live off that money.”
THE TOLL GOES BEYOND THE WALLET
It’s called precarious employment – part-time, contract-to-contract or temporary work. And amid employers’ post-recession jitters, the new normal is a job that’s anything but steady.
In the Toronto area, McMaster University professor Wayne Lewchuk says, as much as 45 per cent of the working population could be in non-permanent jobs.
There’s nothing wrong with this in and of itself, he says. Some people in precarious employment situations are there by choice: They enjoy the flexibility as much as their boss does.
The problem is what usually comes with that precarious position: Unpredictable wages, and hours that often aren’t enough to make ends meet. A lack of benefits means any unexpected medical expense can be financially crippling.
The toll isn’t only financial: Studies Prof. Lewchuk has done in the Toronto and Hamilton area found unstable employment is bad for your health.
That stress was more than Paul Lewis could take. The 48 year old, who’d spent the previous nine years working as a press operator at a northern Toronto plant, gave up his job at a temp agency because the uncertainty just wasn’t worth the minimum wage.
“They’ll send you to a place for two days, then you spend two days at a different place.”
Now he’s training as a gas technician, in the hopes that will improve his employment prospects. He works nights helping with a friend’s cleaning business, sanitizing the innards of empty McDonald’s and Canadian Tire outlets across Toronto proper. But “I’m living on my savings, now. Just bleeding.”
“Can we have this kind of a labour market without the negative impacts?” Prof. Lewchuk asks. “We need to think about how to bring some stability into these precarious jobs.”
WHAT IS WORKING POVERTY?
It’s a tricky question to answer – so much so that attempts to measure or address working poverty can be stymied because it’s difficult to agree on what it is.
An even more basic problem is how you define poverty. Do you change it depending on where you live? Do you use the cost of basic necessities? What counts as a “basic necessity”?
Metcalf’s researchers wanted something representative, says co-author John Stapleton, but they also wanted figures they could be confident in replicating. Some measures may no longer be available without Statistics Canada’s long-form census.
In the end, they picked a fairly conservative definition. A member of the working poor is someone between the ages of 18 and 64; not a student; lives independently; has earnings of at least $3,000 a year and an after-tax income below Statistics Canada’s Low-Income Measure – 50 per cent of the median income for the Canadian population in a given year.