Youth and Newcomers Struggle for Work
Steps to solve youth and newcomers’ joblessness
By Paul Bocking
Five years since the start of the 2008 recession, newcomers and youth between the ages of 15 and 24 face greater obstacles to obtaining employment, according to studies released in September by the Canadian Centre for Policy Alternatives and the Daily Bread Food Bank. These trends are particularly evident in Toronto’s inner suburbs including Scarborough, where food bank usage has grown by nearly 40 per cent since 2008. The Food Bank presents evidence that newcomers in our community, many with significant postsecondary education, continue to be excluded from better paid work, or even from the labour market entirely. In the inner suburbs, 60 per cent of food bank users were born outside Canada (45 per cent in the old City of Toronto). About 33 per cent have at least one university degree.
Thirty-two per cent of first-time users reported that the loss of a job pushed them to visit the food bank. Rules set by the federal government over the past two years make Toronto one of the most difficult regions in which to claim employment insurance, having one of the highest eligibility thresholds for minimum number of hours worked over the past year. The payouts are also among the lowest, as the top 20 best weeks of salary are taken into consideration (in most regions it is 14-19 weeks), meaning that workers with seasonal or more precarious employment are inevitably penalized.
Meanwhile, despite the overall drop in Toronto’s unemployment rate from 10 per cent in August 2012 to 7.1 per cent a year later, for which Mayor Ford was quick to claim credit due to his “business-friendly policies,” according to the Centre for Policy Alternatives’ study, Toronto youth unemployment is now 18.1 per cent—above the provincial average to date for 2013, which is between 16 and 17 per cent. Youth unemployment in the rest of Canada is between 13.5 and 14.5 per cent. While the size of the gap between employment in Toronto and most of Ontario for adults over 25 and youth is unprecedented, it was in 2003 that the rates began to diverge, reaching high levels in the midst of the recession in 2008.
Alongside the long-term decline of employment in Toronto’s still important manufacturing sector, a key explanation for the more recent divergence between youth and adult employment is that a large proportion of new jobs in growing sectors like retail, food services and hospitality have gone to older adults. This trend is especially indicative of the real weakness of Toronto’s post-recession recovery, in that more adults are resorting to jobs that are precarious, part-time and low-wage, and previously occupied by a higher proportion of younger workers. As a result, workers in their fifties and sixties—laid off from long term careers—and newcomers, who have struggled for a foothold in the labour market, are increasingly competing with youth in their late teens and early twenties for jobs in Scarborough’s big box stores and your neighbourhood Tim Hortons.
Community and labour activists in Scarborough continue to work on negotiating local benefits agreements to ensure that massive government-financed infrastructure projects like Metrolinx’s Eglinton and Sheppard LRTs generate good-quality jobs, and that these go to both newcomers with overlooked credentials and youth. This could be done by expanding already existing progressive projects like Hammerheads (run by the building trades unions), to channel youth at risk into well-paid careers in construction. Instead of annual threats to slash municipal funding for Toronto’s non-profit community agencies and recreation centres, we could also build support at budget time for these centres, which would result in increased after-school and summer employment opportunities for youth, and would also provide valuable recreational programs for their communities.
After considerable wrangling between the Ontario Liberals and New Democrats, last May’s provincial budget includes $295 million over two years to encourage hiring of youth under 30 that are not full-time students, by offering up to $6800 to employers to subsidize 4-6 month jobs, plus up to $1000 towards work costs incurred by program participants. The initiative is intended to lead toward permanent jobs. Oversight will be critical to ensure employers don’t replace permanent positions with heavily subsidized short-term jobs and thereby actually increase precarious work.
Beyond employment incentive strategies, it must be acknowledged that economic inequality is almost certainly growing in Toronto and across Canada, as the effects of the recession—and the subsequent recovery—have been very uneven. According to Statistics Canada’s National Household Survey released in September, Canada’s top one percent of wage-earners have annual salaries averaging $381,300—nearly ten times the average wage of $38,700, and over seven times the average full-time wage of $50,699 (note: for full-time workers of colour, the average is $45,128). Compensation for Canada’s top 100 CEOs averaged $7.7 million in 2011. Many experts believe Canada is tracking American trends in inequality. According to US government data on tax returns, the top 1 per cent saw their overall wealth increase by 31.4 per cent from 2009 to 2012, while the income of the bottom 99 per cent rose by 0.4 per cent.
Arguing in this context that action must be taken to “make work pay,” a broad coalition of community organizations, labour and faith-based groups are building a campaign for a $14 minimum wage, to be subsequently indexed to inflation. The coalition argues that with the freeze of the minimum wage at $10.25 since 2010, low-wage workers have seen little benefit from the post-recession recovery. Nearly a million workers in Ontario, 61% over the age of 25, earn between $10.25 and $14.25, according to a study by the Wellesley Institute released in October. Besides immediately improving the quality of life of these workers, higher wages would deliver an economic boost from increased local spending.