Facts about the Working Poor in Canada

FACTS ABOUT THE WORKING POOR IN CANADA

Working poor is a term used to describe individuals and families who maintain regular employment but remain in relative poverty due to low levels of pay and dependent expenses (Wikipedia)

• 20% of Canadian workers earn less than $10 per hour.

• Close to seven million workers in Canada earn less than $20,000 per year (Statistics Canada. 2001 Census: Analysis Series. Earnings of Canadians; Making a Living in the New Economy. Cat. No. 96F0030XIE2001013 (March) pp. 27-28)

• The majority of those living in poverty are working poor - not welfare recipients. (Hon. Ed Broadbent.)

• Those who have an hourly wage below $10, about one in four of all workers - and about one in five adult women workers age 25-54 and one in ten adult male workers, will fall short. Andrew Jackson, (Jackson, 2005: Chapter 2.) 

• In 2008, 35% of all jobs were non-standard - part time, temporary, contract or self-employed. Campaign 2000. 2009 Report Cards on Child and Family Poverty in Canada.

• There are more working poor: 40 per cent of low-income children live in families where at least one parent works full-time year round, up dramatically from 33 per cent in the 1990s. Campaign 2000. 2009 Report Cards on Child and Family Poverty in Canada 

• More than one in six workers, almost 2.4 million Canadians, are in low wage jobs making less than $10 an hour. Most low wage earners are women and many are recent immigrants. Almost half of low paid full-time workers were their family’s major income earner. Statistics Canada. Low Wage and Low Income. (April 2006, p. 10.), taken from CUPE Economic Brief: Thirty Years of Dwindling Minimum Wages in Canada

• "...the best predictor of the number of people living in poverty in a nation is the number of people earning low wages. ..nations that tolerate a greater percentage of low-paid workers are also more likely to have higher poverty rates. Dennis Raphael -- in Poverty and Policy in Canada. Toronto: Canadian Scholars Press, 2007

Despite strong economic growth, historically low unemployment rates and much discussion about labour shortages, about one in six of all employed workers in Canada - almost 2.2 million - was low paid and earning poverty wages in 20061.

• One of every five female employees - over 1.3 million workers - was paid less than $10 an hour, equal to 62% of the low-paid workers in Canada.

• More than 1.1 million full-time workers, or 10% of the full-time workforce, were low-paid.

• Over 1 million adults were paid less than $10 an hour in 2006, including 721, 000 adults who worked full-time -- representing 7% of all full-time adult workers.

• One in five working seniors was paid less than $10 an hour.

This is a low estimate of the number of low wage workers in Canada: many more self-employed workers who didn’t earn an hourly wage or salary took home less than $10 for every hour they worked.

A wage of less than $10 an hour is widely considered to be low pay in Canada because a single individual working full-time all year would need at least this amount to reach the poverty line. Statistics Canada’s low income cut-off for one person in a larger city was $21,202 in 2006. Single parents and those with dependents would require at least $13 an hour to reach their low income cut-off level.

No province in Canada provides a minimum wage that would reach this poverty line.

Source: These figures are calculated using Statistics Canada’s Labour Force Historical Review 2006 CD-ROM (cat no. 71F0004XCB), tables Cd3t06an and Cd3t07an. Taken from CUPE Economic Brief on Lowpaid Work in Canada
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• More than 2 million workers, or 15.7% of the employed workforce, were paid less than $10 an hour.

• Over 60% of the low-paid workforce was women, representing one in five employed women.

• More than 1.1 million full-time workers, or 10% of the full-time workforce, was paid less than $10 an hour; for women this ratio is 13.2%.

• Over 1 million adults were paid less than $10 an hour in 2006, including 721,000 adults who worked full-time representing 7% of all adults who worked full-time.

• One in five working seniors was paid less than $10 an hour, and one in six seniors who worked full-time.

A high proportion of workers in the following occupations and industries were paid less than $10 an hour:

•Retail sales (55.5%) and food service (42.6%)

•Child care and home support (23.7%) and other services (45.2%)

•Occupations unique to primary industry (22.4%)

•Labourers in processing, manufacturing and utilities (22.2%)

Source: Labour Force Survey, in 2006 Taken from CUPE's Low-paid work and comparative wage

More Canadians are Working for Minimum Wage

•The proportion of Canadian workers earning minimum wage grew from 4.7% in 2000 to 5.2% in 2008.

•During the same period, the number working at minimum wage grew by three-quarters-of-a-million workers.

Canada has More Inequality and Poverty than Most OECD Countries

•In 2008, the Organization of Economic Cooperation and Development (OECD) noted that the levels of inequality in Canada were higher than in many other OECD countries. A more recent comparison ranked Canada 12th out of 17 countries.

•Canada spends less on benefits such as unemployment and family than most OECD countries. Working age poverty is a particular concern – Canada ranked 15th out of 17 countries in 2009.

Canadians Want Government Action to Reduce Inequality

•81% of respondents told Environics that during a recession it was more important than ever for governments to make helping poor Canadians a priority.

•93% said that if other countries could succeed in significantly reducing the number of poor people that Canada should be able to do so as well.

Institute of Wellbeing, How are Canadians Really Doing? A Closer Look at Select Groups.
December 2009
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Excerpt from NY Times Op Ed by Barbara Ehrenreich

There’s rising unemployment among all demographic groups, but vastly more among the so-called unskilled....In the US, blue-collar unemployment is increasing three times as fast as white-collar unemployment. The last two recessions in the early 90s and in 2001 produced mass white-collar layoffs, and while the current one has seen plenty of downsized real-estate agents and financial analysts, the brunt is being borne by the blue-collar working class, which has been sliding downward since deindustrialization began in the 80s.

Taken from Barbara's Blog: Too Poor to Make the News - Barbara Ehrenreich comments on working in America

SOURCES

CUPE. Thirty Years of Dwindling Minimum Wages in Canada 

CUPE. Canada to have lowest minimum wages of wealthy Western countries? January 29, 2007

CUPE. Low Paid Work and Comparative Minimum Wages. March 23, 2007 

CUPE. Low paid work still widespread in Canada. November 2007

Edmonton Social Planning Council, Standing Still in a Booming Economy

Fortin, Myriam and Dominique Fleury. A Profile of the Working Poor in Canada.

Social Development Canada Research Paper. 2004. HRSDC. A Review of the Nature and Extent of Vulnerability In the Canadian Labour Market and Federal Jurisdiction. by Richard Chaykowski. December 2005

HRSDC, When Working is not enough to Escape Poverty: An Analysis of Canada's
Working Poor, by Dominique Fleury and Myriam Fortin. August 2006

Institute of Wellbeing, How are Canadians Really doing? A Closer Look at Select Groups. Dec 2009

Jody Heymann, Magda Barrera and Alison Earle. “The Working Poor: Canada and the
World,” Policy Options, Vol. 29, no. 8 (Sept 2008)

Jackson, Andrew. Are Wage Supplements the Answer to the Problems of the Working Poor?

Jackson, Andrew. Work and Labour in Canada: Critical Issues. Canadian Scholars Press.
Toronto. 2005 (Second edition forthcoming in February 2010).

Morissette, Rene and Garnett Picot. Low Paid Work and Economically Vulnerable Families over the Last Two Decades. Statistics Canada Cat. 11F0019MIE No. 248. April 2005.

Morissette, Rene and Anick Johnson. Are Good Jobs Disappearing in Canada?
Statistics Canada Cat. 11F0019MIE No. 239. January 2005.

Raphael, Dennis, Raphael, Dennis. Poverty and Policy in Canada, Toronto: Canadian Scholars Press, 2007

Senate of Canada. In From the Margins: A Call of Action on Poverty, Housing and Homelessness. December 2009

Statistics Canada, Examining the Working Poor in Canada: Is Working a Ticket Out of Poverty? Draft by Wen-Hao Chen, May 2005 

Statistics Canada, Low Wage and Low Income. (April 2006)

TD Economics. From Welfare to Work in Ontario: Still the Road Less Travelled. 2005.

Zuberi, Dan. Difference that Matter: Social Policy and the Working Poor in the
United States and Canada. Ithaca, NY: Cornell University Press, 2006.