Ending Precarious Employment – A Game-Changer Strategy

Precarious Employment is the jargon people like me use to describe the employment conditions and experiences of a growing number of workers in our country. Here is what that jargon means:

Precarious employment is in effect sub-standard employment that offers low wages that typically are not enough to live on, and that does not offer basic benefits like sick leave, vacation leave, or even unpaid bereavement leave. Health and dental benefits are too often absent as a benefit to low-wage workers.

In Ontario, according to the Wellesley Institute, one in three workers do not have health and dental benefits. And the lower your income the more likely you will not have these benefits. In fact, the Institute reports that only one in five persons making $10,000 or less receive health and dental benefits from their employer. As well, the Institute reports that it is not until workers are earning $60,000 per  year that the majority have employer provided health and dental benefits (90%). See this link from Benefits Canada’s website.

Such employment also lacks in any form of job security. Workers can be sent home on a slow day, laid off for seasonal reasons, or simply let go if they are seen to be a “problem.” By “problem” I mean when a worker has to stay home to take care of her child in a work environment where such leave is not allowed. It might be allowed on the books (unpaid sick leave) but not so in practice. Precarious employment can also include work situations where worker safety is ignored, side-stepped, and seen as an unnecessary drain on revenues.

Most employers are likely decent employers, but precarious employment is not rare. Living Wage Canada reports that one-quarter of workers are low-income, the highest rate in the world. Precarious employment is estimated to affect 50% of Ontario workers, according to the Fight for 15 and Fairness collaboration.

A livable income is a game-changer for people. Sufficient income means better access to health services, to good food, to accessing services for our children, for planning for the future, and participating in the economy. A good job offering sufficient income reduces mental health problems, helps reduce stress in family relationships and can avoid the embarrassment, not to mention lack of opportunity, that children face at school when their parents cannot afford the extra fees required for participation in a sport or other school activity. People who earn a livable income can turn their attention from survival to contributing to their community and the lives of those they love and care about.

Imagine if there were more groups, more community leaders, more businesses, more citizens focused on stopping precarious employment and increasing the number of jobs that compensate people fairly.

Systems would change, new and effective policies would surface, employers would treat workers with dignity and people’s human rights would be met.

For more information:

Fight for $15 and Fairness (Ontario)
Fight for $15 (British Columbia)
Fight for $15 (Nova Scotia)
Fight for $15 (United States)

 

Precarious Work

When an employer won’t allow a worker more than 25 hours a week but requires that worker to be available for work 7 days a week, people become little more than commodities on the open market of Precarious Employment.

Lately I have made an effort to talk with folks that work at places like Shopper’s Drug Mart, Home Depot, and Save-on Foods and none of the workers I have talked to get an eight hour shift. My partner’s son just landed a job at 30 hours per week, no benefits of any kind.

Efforts like the Living Wage movement are gaining traction but large corporations seem slower on the uptake than do small business owners. When will the incessant desire to keep wages low by major businesses end up hurting the economy on which these low wage employers depend? There is a tipping point somewhere down the road – for everyone.

The Living Wage movement is a welcome Pan-Canadian effort to ensure that people have a “livable” income. We also need to collectively address the commodification of human beings who are put to work without any consideration for what happens when a worker or her child is sick, for the need to have a day off to rest and revitalize, not to mention deal with life’s practicalities.

Imagine being fired for being sick and missing a couple of days of work. Imagine working for $12.00 per hour in unsafe conditions and suffering from a workplace injury that could have been avoided. Imagine no health and dental care, no vacation time, nada.

Imagine being a part-time worker and not being able to seek other part-time work because your employer wants access to your entire work week to schedule you.

For too many Canadian workers there is no need to imagine. This is their reality.

In Ontario, there is a movement to get the minimum wage to $15 per hour and to bring in legislation and regulations that would address the unsavory trend of precarious work. Led by Fight for 15 and Fairness, the good folks there launched A Better Way Alliance and features videos of business leaders who also believe in the importance of decent work. Click here watch the videos.

Take a look at some great employers who do care and who do value their employers. They tend to be small employers and I have to wonder if they can treat their employees like human beings that matter, why can’t large businesses?

better alliance

Trends Leaders Cannot Ignore

In September I am doing six workshops at Tamarack’s Community Change Institute. One of the workshops is: Ten Trends Leaders Cannot Ignore. I am gathering data right now, investigating trends identified by others; there are so many trends we have to pay attention to that I am not yet certain of the ten I will showcase.  But here are a few trends I am tracking right now that I believe qualify for some substantive, authentic attention by our political, economic, and community leaders.

All the charts below are all based on data from Statistics Canada. Ask yourself what the implications are of these trends and what options we have to address them. While you might take issue with my commentary, the data is the data. Do you think these trends and patterns suggest good news for our society going forward?

wealth
I have written before about Wealth and Income Inequality. While the gap in Canada is not yet as severe as the worldwide trend, the gap is significant and it’s getting wider, as the chart below indicates. Continue reading

Income Trends and Canadian Consumer Debt

Over the past 15 years Canadian consumer debt has risen dramatically.  Since 2000, the percentage of Canadian debt in relationship to disposable income has risen from 110% of income to about 165%. The change in debt to income ratio represents a 12 year increase of 50%.

Income to Debt

The old adage about “people should live within their means” has validity no doubt in many cases, but such maxims simplify the complexity of economic influences and impacts and in this case categorically blame individuals for their debt problems. It’s akin to telling people living in poverty to just buck up and get a job. Stop being lazy and all of that.

Does rising debt have a correlation to slow if any growth in income for Canadian workers? The chart that follows tells a disconcerting story about after tax income in Canada by three cohorts: the top 20% of earners, the middle 60%, and the bottom 20%.  The chart goes back much further in time than the chart above and ends in 2011, but the trends are very clear.

incometrends2

From 1976 the trend in after tax income growth was about the same for all cohorts. In the latter 1990s, however, things changed. Income for the top 20% has escalated quite markedly since then, whereas income growth for the 60% middle earners and the bottom 20% have been small at best.

As the majority of Canadians have experienced flat to very small growth income over the years, they have also experienced far more growth in the expenditures required to house themselves, feed and clothe their families, and so on.

In Edmonton, where I live, the cost of rental accommodations increased on average by 75% between 2000 and 2010. Incomes for the large majority of city residents did not experience such gains. Add rising costs of food over that same period of about 5% per year on average, and the income to expense challenges are obvious.

pullquote1The more one spends to survive, the less likely it is that they will save for a rainy day, much less for retirement or even a short vacation. This contraction on disposable income creates vulnerability for people. When faced with a family emergency or job loss, even job loss for a short period of time, the options are few. Using one’s credit cards are among the few options available.

The Canadian Payroll Association has done annual surveys for a number of years and each year the results indicate that between 45 to 50% of Canadian workers are living pay cheque to pay cheque. The loss of a job to them would, according to the Association, result in serious threats to maintaining their housing. This suggests that half of Canadian workers, while not necessarily qualifying as living below the poverty line while employed, are economically vulnerable to disaster should their pay cheques be lost or interrupted, even for a short period of time.

There are other life experiences that lead to unmanageable levels of consumer debt. Divorce plays a role for many, in particular women who leave the relationship with children to care for, and all too often insufficient, if any, child support. Add to this that the majority of women earn less income than men and we end up with single parents financing their transition from marriage to single parenthood with debt.

Health problems can exacerbate debt as well. Temporary absences from work for surgery, for example, plus recovery time add to the fray. Even those with health and short term disability benefits experience reductions in income during those periods of time. And those without any such benefits are left without any supports from their employer. In Ontario, for example, one-third of workers do not have extended health and dental benefits, according to the Wesley Institute.

Of course debt problems are also caused or at least magnified by a lack in money management skills and other aspects of financial illiteracy. Increasing knowledge and skill about money should be attended to, but to think financial illiteracy is a panacea answer would be both impractical and irresponsible.

Rising consumer debt is not just an economic problem in and of itself. It is part of an overall pattern of systems and values that work to keep worker costs as low as possible to order to drive up margins and that fosters and sustains discriminatory practices that stymie participation in the economy by women,  visible minorities, Indigenous people, the disabled, as well as older and younger workers.

As a general rule unemployment rates and levels of income are higher in the former and lower in the latter for these populations. How come? Do we really believe that such populations do not measure up to the mainstream of the workforce in terms of skills, experience, and work ethic?

There is an irony in all of this. While there is a tendency to blame individuals for accumulating unmanageable debt, our economy is based on growing profits and to do so products and services are pervasively and unrelentingly marketed to grow sales. Persuasive advertising is fundamental to such growth in profits and it tends to work, resulting in too many people purchasing what they want more so than limiting themselves to what they need. In other words, one could argue that we are happy when a sale is made but then critical of those who grow their debt because the advertising worked.

We are seeing progress in addressing some of the factors mentioned above. There is a growing and welcome trend across the nation around employers paying a living wage. For many workers, especially those that have employer-based health and dental benefits, this will make a difference. Paying a living wage is connected to paying a fair wage, but on its own the living wage movement is a partial answer. For example, the cost of living for a single mother with two young children will more times than not be far greater than an increase in income brought about by a living wage.

If we want to turn the tide on economic vulnerability and poverty in Canada, we need to act on the income problem systemically. Child Tax Credit payments are helping and do lift many out of poverty, but for too many the transfers are insufficient.

Canada’s universal health care system is not really universal. For example, unlike many if not most countries with universal health care, we lack a national pharma benefit. Without employer-based benefits, the cost of medications can mean that Canadians are not able to buy them, which eventually leads to higher public expenditures on hospitalization for acute and chronic care. Add to this mix the dramatic trends in length of life, one has to wonder how a rapidly growing number of senior citizens living into their 80’s will be able to manage their health care costs without a pharma plan.

pullquote2Tax reform has a place in the changes we need to make, but on its own is not the answer either. While it seems reasonable for the super-rich to pay more taxes and have less access to opportunities to avoid taxation, the bigger challenge has to do with how governments see priorities, how they decide to spend our money. Systems change that doesn’t address this will be hard pressed to effect substantive change.

Attitudes and values need to be assessed as well. There is an emerging movement to consider human rights in our economic and social decision making. If in a democracy we believe people should be treated equally and have at least equitable opportunities to participate in the economy and in social living, what are the human rights that should guide decision-making?

Our systems appear to place more value on those who are working and doing well than on others who are struggling or who for a variety of reasons cannot work at all (e.g. the mentally ill). While there is a general acceptance that governments should provide income security programs for those who are between jobs or who can’t work at all, there is little, if any, justification for the inadequate financial benefits these income security programs provide. Across the country, at least from what my own research has uncovered, income security benefits do not come close to what it costs to be alive in Canada.

There is encouragement to be found in governments that are exploring a Guaranteed Minimum Annual Income as well as adopting living wage policies and practices in their own shops, but if we carry the same sentiments that keep current benefits far lower than what is reasonable, then I fear a GMAI, for example, will fall far short of the mark. Program changes unaccompanied by a shift in values will at best produce inadequate progress.

While there is a growing understanding that poverty is not just about money, let’s be careful that we don’t step away from the undeniable impact that a lack of income has on people’s lives. The millions of Canadians living on low and unstable incomes may benefit from more social inclusion or subsidized public transit or free passes to recreational facilities, but such programs, although welcome, will not turn the tide of the biggest most pervasive aspect of living in poverty, which is a lack of sufficient income to survive, much less thrive.

Across the country, local communities are taking charge of poverty reduction and this is exactly where such leadership should come from. Local economic reforms are possible in local communities but without addressing national and provincial systems that work to marginalize people of low income and keep them poor, we won’t win the battle. Which is another way of saying, despite our progress, we have so much left to do and we need to foster ways to improve our systems together, across all sectors.

RESOURCES
Vibrant Communities Canada

Time to reframe poverty reduction as matter of rights (Maytree)

Living Wage Canada

Canadian household debt soars to yet another record

Canadians living paycheque to paycheque, especially in B.C. and Ontario, survey warns

Canada needs a national pharmacare plan: Editorial

 

Some Questions: Minimum and Living Wage

Some short snippets to ponder:

None of the government contracts my organization currently has provide sufficient monies to provide my staff with an RSSP or pension plan. Funny though that every one we deal with about our government contracts is paid more than my staff and have a pension plan. Why is that?

I wonder how many of those employers (owners, senior staff) who decide it is cost-prohibitive to provide their workers with benefits have company benefits themselves?

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Look at how many Alberta-based companies already offer a living wage to their employees. Some small businesses in the mix as well as major non-profits. Click HERE.

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The Fraser Institute believes that child care costs are not the basic costs of raising a child. Here is what they say: “The exclusion of daycare costs from the list of needs using the budget standard approach is not because daycare is not a legitimate expense for households with children but mainly because many families with children will have little or no daycare costs. For example, in some two parent (intact) families, one parent may decide to stay at home to care for a pre-school child or children. In other cases, parents may have free daycare at their place of employment or have a close relative who cares for pre-school children. For school-age children, there are again a number of low-cost (or no-cost) options for parents” (Source: Page 40 of this report).

Interesting perspective when considering that the lack of affordable day care for low income or poor families keeps them out of the job market. The idea that most families can send their kids to somewhere free (like have a relative or friend take care of them) is, I suggest, a weak argument. Many poor people live in isolation, have no family support. What do you think of what Fraser Institute is saying?

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Some people don’t want to go with a living wage because they believe the economy can’t pay a living wage. It could be true. However, two things to ask yourself. Often these same voices talk about how great our economy is doing. How great is an economy that cannot pay a living wage? Second, whether or not it is affordable, a living wage is based on what it costs to live. It is not tied to affordability of the economy; it is tied to the affordability of living.

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Isn’t expendable income critical to the economy? If so, why are we content to have more and more people just barely able to get by, if that? How is that good for business?

What is your slant on this. Leave a comment below.