Income security means that a worker can meet their basic needs, at all times. Sadly, this is not the case for many people in Canada. More than 18 months into the pandemic, with vaccine rates plateauing and business restrictions still in place in parts of the country, unemployment remains high.

At the onset of the COVID-19 economic crisis, workers demanded immediate action and the Canadian government created (and further extended) temporary income assistance programs and hiring subsidies to stabilize a shaky economy. A series of emergency response and recovery benefits helped fill in the cracks of Canada’s insufficient Employment Insurance program. The pandemic has exposed the inadequacies in Canada’s social safety net and the need for repair.

Unifor’s Vision

A key component of building back better in Canada is the rebuilding of a social safety net that has been eroding for far too long. Canadians need a series of bold, comprehensive changes including major improvements to the Employment Insurance program, the creation of new income security measures including within Canada’s employment standards, and a national housing strategy that addresses the rising affordability crisis.

Income security is a whole-of-country challenge, but one the federal government must lead. By design, such policies and programs must advance the principles of universality, accessibility, equity and fairness and protect the interests of all workers that contribute to Canada’s economy.

In order to build back better, Canada must create an income security system that protects workers and improves affordability throughout the country. The next federal government should:

  • Make major changes to Canada’s Employment Insurance program, following the recommendations Unifor proposes in its 2021 report, Securing An Inclusive, Equitable And Resilient Employment Insurance Program For Workers In Canada, which includes expanding EI eligibility, enhancing benefits and improving administration;
  • Increase investment in the National Housing Strategy, with an emphasis on long-term, stable funding for non-profit, co-op, and social housing;
  • Establish an independent federal Low-Wage Commission that researches the impacts of minimum wage policy and provides government with evidence-based policy recommendations to address low-wage work;
  • Amend the rules for the Rental Construction Financing Initiative that currently disadvantage builders of non-profit housing;
  • Announce debt forgiveness for students, followed by commitment to work with provinces to eliminate tuition fees for public post-secondary education.

Background

  • Pre-pandemic, only 40% of unemployed workers in Canada received EI benefits, on average —nearly the same coverage rate when the program first started over 80 years ago.
  • A study by Employment and Social Development Canada found that unemployed individuals who received at least $4,000 in unemployment insurance benefits are significantly less likely to experience poverty.
  • Prior to the recently announced $15 minimum wage, 42,000 federally regulated private sector workers in Canada earned the minimum wage in their respective province. Approximately 68,000 made less than $15.
  • The average home-sale price in Canada increased by 26% between June 2020 and June 2021.

Joblessness hit record highs in the early months of the crisis, and has yet to return to pre-pandemic levels. Prior to the pandemic, Canada faced an affordability crisis. Wages barely kept up with the rising cost of living. A shortage of affordable housing limited choices for both renters and buyers. Tuition fees at public institutions skyrocketed in a few short decades. Before the crisis, 3.7 million people in Canada lived below the poverty line – an unacceptable fact for a country as prosperous as Canada.

Decades of stagnate wages have undermined the ability of workers, and especially low-income workers, to improve their standard of living. Greater access to unions can put pressure on employers to pay decent wages. Governments can take action on wages too. As it stands, British Columbia, Alberta and Nunavut are the only three places in Canada that guarantee a $15 per hour minimum wage for the majority of workers. This year, the federal government followed suit, introducing a $15 minimum wage for workers in federally regulated sectors, kicking in at the end of December 2021. This is positive news, but long overdue and still far from adequate. Workers in Quebec, for instance, are right now demanding a minimum wage of $18 per hour, much closer to what constitutes a living wage.

As unions fight at the bargaining table to win wage increases at or above the rate of inflation, for many members, their housing costs – the main driver of their cost of living – is increasing at a much faster rate. In response to a national housing crisis, the federal government launched a National Housing Strategy in 2017. This ambitious, $70 billion, ten-year program means to, among other things, boost new housing supply and improve affordable housing. Three years in and the NHS has produced mixed results. Two of the NHS’ main investment programs have spent less than half of their earmarked funding. Worse still, many of the provincial operating agreements have ended, causing a significant reduction of community housing unit builds.

In the midst of this crisis, Canada’s main income stabilization program, Employment Insurance, was not up to the task. Unprecedented numbers of claims flowed through Service Canada offices, creating major backlogs. EI’s overly restrictive eligibility criteria, low benefit rates and significant gaps in worker coverage, simply could not serve as the vehicle to keep jobless workers afloat. As a result, the Canadian government was forced to create new temporary benefits, including the Canadian Emergency Response Benefit (CERB), to help workers pay the bills.

Changes made to EI in the fall of 2020 helped improve access, significantly – allowing workers to transition as the CERB wound down. These moves are welcome, but remain temporary. Unifor is actively campaigning for significant EI reforms that build a stronger, more resilient, program. The next federal government must prioritize permanent EI fixes that improves access for workers now, and into the future.