Category Archives: Canadian Economy

Raising low-wage workers out of poverty: What is the government doing?

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By Jenny Carson   August 21, 2013  http://rabble.ca

Photo: Bob Simpson/flickr

That there has been a dramatic rise in the number of working poor in Canada is incontestable. In 2013, one in ten Canadians earn minimum wages, more than double the number ten years ago; half of those workers are in Ontario. A recent study conducted jointly by McMaster University and United Way Toronto found that barely half of all workers in the GTA-Hamilton area are employed in permanent full-time positions that provide benefits and a modicum of job security.

The explosion of precarious or insecure employment and the subsequent growth in income inequality are the result of both long and short-term changes in the labour market. The outsourcing of good-paying manufacturing jobs to the developing world, the expansion of the low-wage service sector, reckless Wall Street spending and the assault on unions have all contributed to the current plight of the working class. But also important is the erosion of state support for collective bargaining and basic employment protections.

Governments at all levels have abdicated their responsibility to balance corporate and worker interests to maintain a healthy and balanced economy. The consequences for workers — in the form of shrinking wages, increased job insecurity and declining health — have been disastrous.

It is with cautious optimism then that we should greet recent municipal, provincial and federal-level efforts to address worker poverty and income inequality. On July 19, Toronto City Council voted 28-3 to update the City’s Fair Wage Policy. First established in 1893, the Fair Wage Policy requires contractors and suppliers for the city to pay their workers the prevailing market wages and benefits in their field of employment or, for unionized fields, union rates. The policy was designed to protect workers from unscrupulous contractors trying to underbid their competitors by paying their workers less than the prevailing wage rates, and to enhance the city’s reputation as an ethical employer. However, because the rates had not been updated since 2003, until last month many of the city’s “fair wages” fell below the Ontario minimum wage of $10.25 an hour.

The July 19 vote to update the fair wage rates reveals that a majority of councilors understand that is bad policy for the city, as an employer, to add to the growing ranks of the working poor (this excludes councilors like Denzil Minnan-Wong who sees as any kind of wage control as “social engineering”) Under the new rates, contractors providing janitorial services for the city must pay their workers at least $12.43 an hour. Cleaners in the private sector in contrast almost always earn minimum wages.

Unfortunately, however, a fair wage is not a living wage, which the Canadian Centre for Policy Alternatives estimates to be $17.76 an hour in Toronto (a living wage covers the cost of basic necessities such as shelter, food, clothing and transportation). The city’s fair wage rate for cleaners would barely raise a worker out of poverty and, if she or he were supporting a family as is often the case, would in fact leave them in poverty. This then is only a first step if the city truly wants to be an ethical employer.

On July 19 City Council also agreed to devise a “job quality assessment tool” against which any jobs being contracted out would be measured. The basic idea behind this initiative is to ensure that the city is not turning good jobs into bad jobs through the contracting-out process. As well as considering wage levels, the tool will include other criteria such as worker health and safety, skills and training opportunities, working conditions and other factors which determine job quality. Ideally, the job quality assessment tool, which will be considered by Council at the end of this year, will provide some protection for city workers who will no doubt face another round of privatization pressure as Mayor Ford runs for re-election in 2014. How successful this initiative will be depends on whether workers and their unions are given a voice in its formulation and implementation, and it’s not yet clear if they will be.

At the provincial level, the Wynne government recently announced the creation of a minimum wage advisory panel that will consider how to calculate increases to Ontario’s minimum wage. The six-member panel, chaired by University of Toronto Industrial Relations and Human Resources professor Anil Verma includes representatives from labour, business and youth, the latter of whom are disproportionately represented among low-wage and precariously employed workers.

The minimum wage in Ontario has been frozen at $10.25 for the last three years, and will remain so for at least the next six months as the panel conducts public consultations and studies how other jurisdictions calculate minimum wage rates. Anti-poverty activists are justifiably angry that it has taken the Liberals more than two years to set up the panel, and wonder why, unlike many other provinces, Ontario does not provide automatic annual minimum wage increases pegged to inflation. Ontario Labour Minister Yasir Naqvi’s assertion that we need a “made-in-Ontario” solution raises more questions than answers.

Yet once again there is reason to be hopeful that this initiative will help low-wage workers, many of whom are newcomers to Canada climb out of poverty and contribute to the economic recovery we so desperately need (remember, low-wage workers tend to spend every cent they earn in the local economy). The panel will most certainly recommend a wage increase and, perhaps just as importantly, develop a more predictable formula for raising the minimum wage in the future (in the past this has been done on an arbitrary, ad hoc basis that resulted in a nine-year wage freeze under the Conservatives). Only time will tell whether the panel’s political masters, whoever they might be next spring support a progressive overhaul of the system.

Despite the chilly climate for workers on Parliament Hill, there may also be reason to hope for change at the federal level. Next spring NDP Member of Parliament for Toronto Davenport Andrew Cash will introduce a private member’s bill to expand EI access to part-time and self-employed workers and to eliminate the use of unpaid interns. Cash has a personal as well as professional interest in the issue as someone who spent most of his adult life precariously employed in the creative sector. His bill would modernize a program that no longer reflects the employment realities of many Canadians, and make it harder for employers to engage in unethical and often illegal practices such as hiring workers as “independent contractors” so as to avoid obligations under employment law. It would also reform a pension system that currently consigns large numbers of elderly Canadians to poverty.

Cash understands that legislative changes to EI are only part of the solution. He envisions a multi-pronged approach that includes affordable daycare (along the lines of Quebec), social programs to fight poverty, and decent and affordable public transit. While the chances of Cash’s bill passing under a Conservative government are next to zero, his laudable initiative has the potential to start a public dialogue about how the EI system is failing Canadian workers. It is also, as Cash explains, an issue which “spans the employment silos and class divides” that traditionally divides workers. His bill has the potential to mobilize a broad cross-section of the working class, from journalists to taxi drivers to computer programmers. Its long-term success depends in large part on whether this mobilization takes place.

Together, these initiatives reveal that government (or at least some within government) is finally beginning to heed worker and progressive demands for action that will stem the alarming growth of job precarity and worker poverty in Canada.

It is far from clear whether any of these initiatives will lead to real change for workers, but collectively they suggest that at least some of our elected officials understand that government has a stake in creating a more equitable society.   

Jenny Carson is Associate Professor in the Department of History at Ryerson University.

Photo: Bob Simpson/flickr

Examining Harper’s record and spotting a fake economic recovery

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Duncan Cameron

By Duncan Cameron    August 20, 2013   http://rabble.ca

Photo: Liam Richards/University of Saskatchewan/flickr

A new report from Citizens for Public Justice (CPJ) on job creation in Canada arrived just as the Prime Minister said Monday he intends the next election to be about jobs and the economy. As part of a study of poverty, CPJ has published a set of fact sheets on job creation in Canada since the 2008 recession. It looks at regional and generational differences, assesses job quality and measures newly created jobs against new job seekers.

Anyone who believes what Conservative cabinet ministers have been repeating about job creation in Canada should read the CPJ fact sheets.

Carol Goar of the Toronto Star identified the CPJ report as explaining why many Canadians are still experiencing the recession. The Canadian employment rate is down: the number of jobs created (950,000) has not increased as fast as the population (1.8 million). Unemployment is stuck at 1.4 million. When talking about the unemployed, the government does not include discouraged workers, people with part-time jobs looking for full-time work, temporary jobs, or the under-employed. Add them to the total, and the real unemployment rate is one out of ten out of work.

CPJ explain about 500,000 jobs are needed to get Canada back to where it was before the recession. Stronger job growth where resource prices are strong (Alberta, Saskatchewan, Manitoba) and in construction mask weaker job growth in services and manufacturing.

Employment trends are weakest for Aboriginal Canadians. Young Canadians suffer disproportionately from unemployment — about one in five is without work.

Sadly, paid work increasingly means precarious jobs: part-time, low-wage and unstable. Older workers are relying more and more on temporary work.

Policy analysts divide over what to do about a lackluster economy. Some want to leave the market alone, most think governments need to lead in order for it to recover.

Conservatives believe the marketplace works fine, and any problems can be fixed by allowing prices to adjust. Unemployment is explained by the failure of rates of pay to fall, because of minimum wages, unions, employment insurance, welfare and other market imperfections, which need to be eliminated or reduced.

The problem with this view is that rates of pay are falling — policies to reduce wages have been successful, increasing inequality as Stephen Gordon has shown in Maclean’s. For the Harper government, business-funded think-tanks, and other supporters of the market view, this just means wages have not fallen enough. More of the same is just what is needed.

Those unwilling to wait for the economy to correct itself will want to know how it can be improved.

In Canada the standard strategy for an underperforming economy is a currency devaluation, accompanied by fiscal tightening. Exports incomes increase, import increases are cut off, and the private sector leads the recovery.

Floating the Canadian dollar down used to only require lowering Canadian interest rates below U.S. rates. Unfortunately, the U.S. beat Canada to the interest rate bottom, with a “zero bound” rate, introduced to revive American capitalism.

Historically low rates do prevail at the Bank of Canada. This is supposed to encourage recovery, though without bringing a currency devaluation, it is hard to see how it is going to happen.

Former Bank of Canada Deputy Governor William White called low interest rates having one foot on the accelerator. With the Harper government curbing spending, White observed, Canada has the other foot on the brake.

This contradictory policy needs to be fixed. The obvious choice is for the government to take the foot off the brake and spend borrowed money for needed public investments in urban transit, retrofitting buildings to reduce energy use, recreation, culture, the arts, advanced education, child care, and straight job creation.

The Harper government is ideologically opposed to government spending, but expect it to consider taking its foot off the brake by lowering taxes. Another reduction in the GST would inject new money into the economy, for instance. And it would also be an excuse to reduce direct spending (and reduce wages) further down the road.

The Official Opposition have their work cut out for them just to expose the poor Canadian economic record, let alone engage Conservatives in a rational debate based on economic evidence.

Stephen Harper does not expect Canadians to discover that job performance has been poor and that the economy is not improving, while the standard of living for most Canadians is declining. He has announced plans to prorogue Parliament, cutting the fall session short. This will limit the time for parliamentary debate and the subjects raised by the opposition.

If the economy is going to be the ballot question in the next election, as Stephen Harper suggests, Citizens for Public Justice have afforded parliamentarians and all Canadians with what is needed to examine his government’s record.

Duncan Cameron is the president of rabble.ca and writes a weekly column on politics and current affairs.

Photo: Liam Richards/University of Saskatchewan/flickr

A Race To The Floor For Minimum Wage: Can It Be Stopped?

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just-saying_thumb      By Andrew Chernoff     https://andrewchernoff.wordpress.com/

First it was Jordan Bateman of the Canadian Taxpayers Federation with his article, “The pay of government workers is way out of line” published July 31, 2013 in The Province, to which I made my feelings known about on August 3, 2013 in my commentary, “Bateman Advocates A Race To The Floor For Minimum Wage…You First, I’ll Give Ya A Push”.

Just like a bad smell you can’t get rid of, or a bad itch you just can’t seem to scratch, another proponent of the drive to lower wages——–using a corrosive and mean-spirited abuse of the privilege of free speech for hateful, venomous and spiteful unsupported comments with the intent to rile, incite anger and get an antagonistic reaction——comes forward.

Ms. Margaret Wente, a so-called journalist for the The Globe and Mail, woke up recently seemingly during that bitchy time of the month (the only way I can explain it), and decided to lambaste, insult and take undignified shots at Canada’s firefighters—all of the “Nations” firefighters—-without exception.

In her article on August 8, 2013,  “A Nation of $100,000 Firefighters”, Wente charges, “municipalities do not love firefighters.”

Further, she claims to speak and know the feelings of our municipalities and regions, proclaiming, “ Across Canada, towns and cities are getting hosed by the skyrocketing costs of their fire departments.”, of which firefighters, she suggests, are the main reason for those increased costs because, municipalities, “simply match the settlements that everybody else got, including police. So the costs spiral ever upward,”

She continues, by adding insult to injury when she claims, “Thanks to arbitration settlements, your firefighters are the best paid (and possibly the most underworked) guys in town.”

Really?? Possibly the most underworked in MY town? Hmmm….she’s been in my town??….I think not!

She claims to have nothing against fire fighters. “I have nothing against firefighters, personally. But times have changed. We can’t go on like this. I could write the same column about the police. You guys are supposed to protect us. But we can’t afford you any more.”

But she does say, “They look good on calendars.”  A sexist comment I dare say. And dare I do.

So nobody is safe. The police make too much. School teachers? Bus drivers? Janitors? Airline pilots? Ambulance drivers? Paramedics? Who is not a target for Ms. Wente?

She obviously has a lustful crush for Stephen Harper and his Canadian Austerity plan. In her desire to drive down wages, she is a true Harperite, spreading propaganda for that race to the floor for minimum wage, to increase that disparity between those that have, and those that don’t—between the 1% and the 99%.

According to Wente, our firefighters have barely anything to do, “Working conditions are pretty sweet too. Thanks to modern safety standards, there are very few fires left to fight. These days, most fire department calls are medical. To prove that they’re still needed, fire departments have been adding defibrillators and Jaws of Life, and frantically expanding their repertoires to respond to even minor non-fire emergencies. Still, there’s an awful lot of what we shall euphemistically call “down time,” which firemen fill by preparing meals, sleeping, watching television, polishing the trucks and rewinding the hoses.”

She claims that the costs and salaries for Canadian firefighters are for smaller cities, “typically the largest item in the budget. It accounts for upward of a quarter of their costs.” And that firefighters and their unions are so insensitive, greedy in the community and regions they live in, that “the costs spiral ever upward, and towns are forced to cut back on libraries and roads.”

This is one woman who has one hell of a bitchy time of the month; so much so, that a grizzly bear would be no match for her spite and hate.

“But the really crass way that the rich have of driving down wages is by subtly and not so subtly feeding people’s envy and greed…making us worry that someone else might be getting ahead, might be doing better than us. We aren’t talking about getting us riled over the wages of bankers, brokers and sports stars; we profile them in the fashion and shopping pages of the papers.”, OperationMaple writes in its reaction to Wente’s column, titled, “Let Us Count The Ways of Driving Down Wages”.

I continue with the following quote from OperationMaple’s article referred to above:

“The Rich and their Media Mavens saved the corrosive power of envy and greed for school teachers, fireman, bus drivers…all the folks that live next door and shop at the same stores we do. Let’s get agitated and angry with Joe down the street and Alice around the corner for having a job with a union, a negotiated wage and benefits and let’s try and pull them down to our situation…part time work and no benefits and lousy pay. Because when their economic situation is as desperate as ours, then everything will be ok.

They get paid too much and work too little and couldn’t we all get by with a volunteer firefighting force? Just because they are the ones who run into burning buildings when the rest of us are running from burning buildings, in Wente’s view, doesn’t justify the wage they get.

It used to be the case that when people got decent wages and benefits through collective action we’d all cheer them on and try to copy their efforts, create our own unions and seek our own collective success. Not anymore. Now we just want to tear down those folks lucky enough to have a union. The drive to lower wages by making all of us envious of our neighbours is succeeding. That’s why the 1% and their media allies, their media employees go after Employment Insurance and Firefighter wages…because it works and it distracts us from the folks that are truly criminally over-paid: bankers and brokers.”

I conclude with the following remarks.

The drive to lower wages may be succeeding in some minds, but it has not succeeded everywhere and with everybody. Are you going to let it happen to you? Will you start fighting back now, and let yourself be heard? Will you stand up? Will you get involved in civil disobedience and fight the good fight?

The drive to lower wages is nothing but a race to the floor of minimum wage. We are expected to give up more, so the rich can get richer? I think not.

The richest 300 people in the world are more wealthy than the poorest 3 billion combined, and every year rich countries take over 10 times more money from poor countries than they give in aid, according to therules.org. Find out more by visiting  http://www.therules.org

Don’t let yourself succumb to the race to the floor of minimum wage.

Austerity chokes the down-and-out, as Harper and Flaherty look the other way

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By Nick Fillmore  August 16, 2013  http://rabble.ca

Austerity chokes the down-and-out, as Harper and Flaherty look the other way

The exceedingly aggressive austerity cuts carried out by Prime Minister Stephen Harper and Finance Minister Jim Flaherty over the past seven years have come home to roost as millions of Canadians, depressed and without hope, are succumbing to its worst consequences.

Program cuts and tax reductions for corporations and the wealthy have had a huge, disproportionate impact on the poor, working poor, underemployed, and those with health problems including mental illness.

The massive austerity program translates into less income, decreased services, and reduced health care for many of Canada’s most vulnerable people. It appears that more than 3.5-million Canadians — mainly the poor, the unemployed/underemployed and the under-privileged — are struggling.

The attacks on the vulnerable began soon after the Conservatives came to power in 2006. They launched cuts that were a broadside attack on the government’s ability to finance many of its activities, including these much-needed employment and social support programs.

Ignoring the needs of Canadians living in desperate conditions, Harper and Flaherty initiated the extremely aggressive austerity program because of their determination to reduce the deficit and cut the size of the federal government. Their decisions were based on their own neo-liberal economic beliefs, not what Canadians needed or wanted.

There are numerous examples of needless, brutal cuts. Claiming it was concerned that some people don’t have enough incentive to work, Harper-Flaherty toughened up the Employment Insurance rules. They took millions of dollars away from mostly seasonal workers, leaving them vulnerable.

Human Resources and Skills Development Canada (HRSDC), the government department that provides the most hands-on support for the poor, is being cut more than any other department. It will lose 5,700 positions — one-quarter of its workforce by 2016. The largest cut in absolute terms is to the Citizen-Centered Services Program, which helps Canadians access government services by phone and online.

Harper also cut funding to the National Aboriginal Health Organization (NAHO) and to a number of Aboriginal women’s health organizations — crucial programs on suicide prevention, women’s health, and diabetes. They also cut the Women’s Health Contribution Program, which funds six women’s health organizations across the country.

The austerity cutting is based on Harper and Flaherty’s near-fanatical determination to cut the deficit and reduce the size of government. The two unwaveringly believe in neo-liberal economics, which enriches corporations and the wealthy at the expense of the rest of us. We have two people running our country who don’t really believe in government!

Unfortunately, the problems of the less fortunate are not acknowledged in the PMO or Department of Finance. It is much more important that interest rates remain low for the benefit of corporations and the one per cent. A Google search for any Harper or Flaherty comments that express any concern or interest in the problems of the poor comes up empty.

Two moves early on by Harper and Flaherty eliminated the ability of the Conservatives to fund the kind of generous, liberal-minded government Canadians have been used to. First, a two-per-cent cut in the Goods and Service Tax income in Flaherty’s first two budgets cost the government a staggering $10-billion to $12-billion annually in revenues that had been used to help support government services.

In addition, Flaherty has cut $60-billion in corporate taxes since the Conservatives took power in 2006 – needlessly reducing the country’s corporate tax rate to the lowest among G8 countries.

The austerity program and other government cuts have had disastrous consequences for millions of Canadians. There are staggering disparities in life expectancy based on the amount of education a person receives and their amount of education. On average, people living in rich neighbourhoods live an average of 86.3 years, while those living in a poor neighborhood live only 65.5 years — a difference of 21 years.

There is more hunger across the country than ever before. In March, 2012, 882,188 people received food from a food bank in Canada — an increase of 2.4 per cent over 2011 and 31 per cent higher than in 2008, when austerity was being launched.

Children are not spared from the suffering. According to UNICEF’s most recent report, Canada is 21st out of 29 top countries for relative child poverty, and 27th for the percentage that were overweight.

Between the years 2007 and 2011, Statistics Canada reported a 20 per cent rise in people who said their mental health was deteriorating. Mental illness is already the number one cause for disability claims in the workplace. According to the Mental Health Commission of Canada, awards for mental injury at work have dramatically increased in recent years because of pressure placed on workers to produce more during the austerity period.

It’s also likely been an increase in suicides in Canada due to the distress suffered by individuals as a result of the austerity program. Two international researchers, David Stuckler and Sanjay Basu, have documented substantial increases in suicide in several European countries and the United States as a result of austerity cuts. Suicides in Canada increased from 3,512 in 2005 to 3,890 in 2009, which takes in the early part of the austerity period. However, Statistics Canada is three years behind in posting its deaths statistics, so no information is available covering a large period of austerity. But, assuming that Canada is experiencing roughly the same fallout as are Europe and the U.S., it is safe to predict a sizeable increase in suicides here.

Throughout the Conservatives’ seven years in office, independent economists argued that the austerity program was not achieving its stated goal of preparing the country for an economic recovery, but Flaherty refused to budge.

Then in April, the world was shocked when the austerity experiment, which was had destroyed the lives of millions in Europe, was totally discredited. Thomas Herndon, a young University of Massachusetts Amherst graduate student in economics, discovered that an influential paper endorsing austerity practices as a way of rebuilding beleaguered economies was incorrect because of spreadsheet coding errors and selective data.

Amazingly, Flaherty continued with the austerity experiment. “What I worry about is those that suggest that austerity should be abandoned,” he noted. “I think that’s the road to ruin quite frankly.”

So more cuts that will affect the poor the most are on the way. Harper and Flaherty will chop another $11.8 billion from government spending by 2014-15; job losses in both the public and private sectors will be 90,000 by 2014-15; and there will be 1.4 million unemployed workers in the country in 2015.

If Harper and Flaherty really wanted to balance the budget and look after people at the margins, they could work harder to collect the $29 billion the government is owned by the rich and corporations in unpaid taxes.

They also could try harder to find the $3.1-billion that was given to the anti-terrorism program but now cannot be accounted for.

The Council of Canadians says if Harper and Flaherty really wanted to both gradually reduce the deficit and look after the needs of the poor, they could continue to stimulate job growth through needed infrastructure projects (water, transit, green energy, roads, etc.), and reverse corporate tax cuts. Not by suffocating those at the very bottom of the pyramid.

Nick Fillmore is a freelance journalist who worked in many areas with the CBC over nearly 30 years. He is a former member of THIS magazine’s editorial board and was publisher of The 4th Estate, an independent weekly in Nova Scotia, during the 1970s. Fillmore was also a founder of the Canadian Association of Journalists. To see other articles, visit his blog.

CLC endorses consumer boycott of Labatt imports: St. John’s brewery workers on strike since April

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August 15, 2013     http://www.canadianlabour.ca

Labatt brewery strike escalates with a CLC boycott

OTTAWA ― The Canadian Labour Congress has endorsed a national consumer boycott against a number of imported brands of Labatt beer and is calling on the company to return to the bargaining table.

“This is a David and Goliath struggle between about 50 local workers and the world’s largest multi-national brewing corporation trying to force its employees into a race to the bottom,” says CLC President Ken Georgetti. “Canadian workers and their unions are not going to stand idly by and allow this to happen.”

The workers in St. John’s have been on strike since April 10. They are members of the Newfoundland and Labrador Association of Public Employees (NAPE/NUPGE). Their employer is the Canadian division of the Anheuser-Busch InBev brewing corporation, which has after-tax profits of more than $9 billion.

“This multi-national company is trying in St. John’s to impose concessions and roll-backs on its employees which would establish a precedent for its other unionized workers across the globe,” says Georgetti. “We can’t allow them to get away with that.” 

The national consumer boycott was requested by the National Union of Public and General Employees (NUPGE), the national union to which the striking workers belong. The Labatt imports being targeted for boycott include Stella Artois, Becks, and Lowenbrau. The focus is on imported products in order to prevent other unionized Labatt employees in Canada from experiencing a loss of work.

In Newfoundland and Labrador people are also being urged to boycott a number of other Labatt beers, including Budweiser, Labatt Blue, Alexander Keith’s and Kokanee.

The Canadian Labour Congress, the national voice of the labour movement, represents 3.3 million Canadian workers. The CLC brings together Canada’s national and international unions along with the provincial and territorial federations of labour and 130 district labour councils.

Web site: www.canadianlabour.ca
Follow us on Twitter @CanadianLabour

Contact: Dennis Gruending, CLC Communications: Tel. 613-526-7431.
Cell-text: 613-878-6040. Email: dgruending@clc-ctc.ca