We are often told that the solution to poverty is for the poor to “get a job” or for various sectors to create more jobs. But the reality is that a job is not a guaranteed path out of poverty. Many of the new jobs created in BC since the 2008 recession have been part-time, temporary and low paid. The result is a growing group of workers living in poverty, the working poor.
We all know that some jobs pay low wages and don’t provide stable hours. At the current minimum wage of $10.45, a minimum wage worker with no dependents working full-time earns less than the poverty line both before and after tax. Recently announced increases over the next year and a half won’t change this.
Some people mistakenly believe that low wage jobs are filled mainly by teenagers and youth, and are a rite of passage of sorts while young people still live at home. But most low-wage workers are not kids — they have families, and they get stuck in dead-end jobs that keep them in poverty.
Over 100,000 working-age people in Metro Vancouver were working but stuck below the poverty line in 2012, according to a new reportby the Canadian Centre for Policy Alternatives, the United Way of the Lower Mainland and the BC Poverty Reduction Coalition. Another 73,500 working poor British Columbians lived outside the Metro Vancouver area. Across Canada, over a million workers aged between 18 and 64 were working poor.
These numbers are conservative estimates, as they don’t count post-secondary students or adults living with their parents or other relatives. The true extent of the problem is likely much worse.
Almost two thirds of Metro Vancouver’s working poor in 2012 were between the ages of 30 and 54 — what economists consider prime working age (61%). Almost half of the working poor had dependent children (42%). In Metro Vancouver, single parents are the most likely to experience working poverty, followed closely by individuals living alone.
While we don’t have data on immigrant status and working poverty, a recent Statistics Canada study showed that the poverty rate among Vancouver immigrants who have been in Canada for fewer than 15 years is double the rate of long-term immigrants and Canadian-born citizens.
Among Canadian cities, Metro Vancouver has the second highest rate of working poverty (8.7% of the working-age population), after Greater Toronto (9.1%). The hardship is even more severe in these two regions than the statistics show, since the measure of poverty used in the study does not account for differences in housing costs across the country.
Contrary to stereotypes about poverty being concentrated mainly in Vancouver and Surrey, our study finds the working poor are spread out across the Metro Vancouver region. In 2012, the latest years for which we have data available, rates were highest in Richmond (10.5%), Vancouver (10%), Burnaby (9.4%), Surrey (9.1%), North Vancouver (8.4%) and Coquitlam (8.1%).
What is worse, working poverty rose after the recession in most Metro Vancouver municipalities. The largest increases occurred in the suburbs – West Vancouver, Coquitlam, White Rock, Lions Bay and the District of North Vancouver. Growing working poverty truly is a regional problem in Metro Vancouver.
Working poverty is somewhat invisible, even though these workers are all around us. They pour our coffee in the morning and clean our offices at night. They sell us groceries, housewares and clothes, they greet us at reception desks and keep our concerts and public events safe. They cook and serve our food when we are celebrating with a night out and tidy our hotel rooms when we are on vacation.
Metro Vancouver’s booming economy relies on these workers but it’s failing an increasing number of them. Work should be enough to lift a family out of poverty.
Simply creating more jobs won’t fix the problem. But the good news is that working poverty can be reduced and eventually eliminated with a combination of labour market reforms, more generous income supports, and better public services.
Every level of government has a role to play, but the provincial government is uniquely positioned to take the lead since it has jurisdiction over the labour market and many crucial social policy areas.
A $15 minimum wage, stronger employment standards, more affordable housing, a $10/day child care program and better access to education and training for low-income earners are key parts of the solution. Ending working poverty can and should be part of a comprehensive poverty reduction plan for BC.
Iglika Ivanova is a senior economist at the Canadian Centre for Policy Alternatives – BC Office. Michael McKnight is President & CEO of United Way of the Lower Mainland. Trish Garner is the community organizer of the BC Poverty Reduction Coalition. Their organizations co-published the report Working Poverty in Metro Vancouver.