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A Paycheque, But No Way to Live

Editor's Note: Editor's Note: This editorial is reprinted from the Toronto Star, July 18, 2003, courtesy of Torstar Syndication Services.

Last winter, when Finance Minister John Manley was boasting about Canada's strong job-creation record, the department of human resources quietly asked a handful of experts to look ahead five to 10 years and identify some of the challenges looming in the labour market.

One of them was Andrew Jackson, senior economist at the Canadian Labour Congress.

His paper has just been released by an Ottawa think-tank. It raises questions that deserve to be debated publicly and considered seriously by Canada's next prime minister.

Jackson's basic contention is that a job is no longer a safeguard against poverty or the key to a better future for millions of Canadians.

These people work, but they don't earn enough to support themselves. They long to improve their prospects, but they are excluded from most training programs.

Fully one in four workers is trapped in a job that pays less than Statistics Canada's low-income cut-off.

This large--and growing--segment of the population doesn't show up in the monthly unemployment figures, doesn't appear on the welfare rolls and doesn't get much attention from mainstream economists.

It consists primarily of unskilled young people, recent immigrants, single parents, aboriginal Canadians and people with disabilities. They drift from one temporary job to the next, do contract work or settle for part-time employment. The pay is low and the risk of termination is high.

It is true that the job market has always been stratified. But the gulf between those with secure, remunerative work and those in precarious, low-wage jobs has widened dramatically in the last decade. Globalization, corporate restructuring, government cutbacks and technological change have pushed increasing numbers of workers to the margins of the labour force.

"I think it's a huge problem," Jackson said in an interview. "I can buy into the idea of getting people into jobs. The critical question is what kind of jobs are we fitting them into?"

Prime Minister Jean Chretien didn't have to grapple with this dilemma when he took office in 1993. It was enough to offer Canadians "the dignity of work."

Former prime minister Brian Mulroney didn't have to worry about a polarized workforce in 1984. He could safely declare: "The best social program is a job."

Today, however, work is not synonymous with dignity. A job isn't necessarily a source of pride and stability.

What this means, Jackson says, is that new tools are needed to make work pay.

Naturally, as a labour economist, he sees collective bargaining as the best way to raise wage levels and improve working conditions. But he acknowledges that two-thirds of the workforce is not unionized and there is little chance that small firms in the service sector--where the most vulnerable workers are--will be organized anytime soon.

Better family support policies would help, Jackson says. If affordable child care were available across the country and new immigrants were properly integrated into the workforce, fewer workers would have to take menial, dead-end jobs.

But if Ottawa and the provinces want to get to the heart of the problem, he contends, they will have to do something they've been reluctant to do: Intervene directly in the labour market.

He proposes two policy changes:

First, he would like to see Ottawa set a wage floor of $10 per hour for all workers within its jurisdiction. That includes not only federal public servants, but also employees of Crown corporations, chartered banks, airlines, railways, bus companies, television and radio stations and telecommunications firms.

This "living wage" would keep federally-regulated workers, who constitute 12 percent of Canada's labour force, from falling below the poverty line.

Jackson hopes it would also put pressure on the provinces (whose minimum wages vary from $5.90 in Alberta to $8 in British Columbia) to follow Ottawa's lead.

He knows such a policy would provoke an outcry from business. But he maintains that, after a period of adjustment, productivity would improve and worker turnover would drop.

Second, Jackson would like Ottawa to introduce a training benefit as part of its Employment Insurance program. This would entitle workers to take time off to upgrade their skills, while receiving 55 percent of their normal earnings.

Employers would be required to pay a worker's EI premiums while he or she was on leave and keep a position open. Workers would be expected to sacrifice part of their income.

Under this plan, individuals in subsistence-level jobs would get an opportunity to train for something better and immigrants would be able to get their credentials recognized.

The bureaucrats who commissioned the paper did not make any commitment to act on its recommendations. But they did undertake to circulate Jackson's ideas in Ottawa.

It is good that federal policy-makers are thinking ahead.

It would be better if they let Canadians into the process.

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