Evidence of meeting #4 for Status of Women in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was jobs.
A recording is available from Parliament.
11:10 a.m.
Liberal
11:10 a.m.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
I wonder if I could just put forward an inquiry before we begin today.
11:10 a.m.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
When the minister was here, she indicated that she would be happy to come back to talk about performance review either today or Thursday. Will she be coming Thursday?
11:10 a.m.
Liberal
11:10 a.m.
Liberal
The Chair Liberal Hedy Fry
The response was that she couldn't make it at that particular time, and we would hear back further when she can attend.
11:10 a.m.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
Could we follow up? Because she indicated that she would come any time.
Thank you.
11:10 a.m.
Liberal
The Chair Liberal Hedy Fry
We will. We intend to.
Can we leave this to deal with under future business in camera?
Our orders of the day are pursuant to Standing Order 108(2), a study of the consequences and effects the current Employment insurance, EI, programs have on women in Canada.
We have two witnesses today, and we will begin. As you know, the witnesses will have ten minutes to speak, and then, as you know, we will go in the order with regard to the length of time for the first questions, etc.
I shall begin by asking Ms. Yalnizyan if she's ready to begin.
Are you, Armine?
11:10 a.m.
Armine Yalnizyan Senior Economist, Canadian Centre for Policy Alternatives
Madam Chair, thank you very much.
11:10 a.m.
Liberal
11:10 a.m.
Senior Economist, Canadian Centre for Policy Alternatives
Good morning, ladies. I am very pleased to be here, to see you again and to be at this meeting. I am going to speak in English. I have no notes to circulate, but I can send you some afterwards, depending on the questions that interest you.
I want to make five points today, very briefly.
I thank you for holding this meeting in times that are so unusual in our economic history and so important to both men and women.
First of all, I want to make the point about labour force rates and how when times get tough women come to the fore. They come to the fore, of course, in unpaid ways, but importantly and historically, women have moved ahead in tough times to help support their families. I want to make a point about historic unemployment rates and how and why women are now less unemployed than men. I want to make a point about who gets access to unemployment insurance and under what conditions. I want to make a point about how women's pay affects that access. And I want to make a small cluster of points about what we can do about it.
Historically, labour force rates of women have gone from 22% of the labour force in the immediate post-war period, 1946, to about 30% in 1960 and about 35% in 1975. It has kept climbing and climbing. The story of Canadian economic history is that women have taken more and more of an active role in the economy.
Today, and since about the mid 1990s, Canadian women make up about 47% of the labour market. So we're about equal partners with men. Roughly speaking, that's the same when it comes to unemployment as well. About 44% of the unemployed today are women.
That has gone up and down in time. I was just looking at the numbers. In fact in the two biggest recessions we have had in the post-war period--the 1981-82 recession and the 1990-91 recession--women's unemployment rates went down. They moved forward as their men lost jobs and their families fell apart. Their unemployment rates actually fell. What is fascinating is that since the 1990 recession women have sustained that lower rate of unemployment even though they make up a significant proportion of the unemployed.
Women have picked up the pieces for families for a very long time. In fact since the mid-1980s it has taken two income earners to get into the middle class and to stay in the middle class. That has huge consequences for what we're facing in the road ahead. There is no reserve army of labour now to pick up the pieces with part-time work, to make sure that family incomes are sustained. Families are peddling as fast as they can. It has a huge consequence for what happens when one person loses a job. We have today's release of unemployment insurance rates, and the increase in the number of unemployed men has grown fairly remarkably.
I'm working on a piece that takes a look at what has happened with respect to recessions, unemployment, and unemployment insurance benefits from the 1920s on. For the first time in our history we have a recession that has been propelled by forces outside of our border; exports have driven it. We haven't begun to see the domestic fallout from this contraction of the economy in the official numbers that are coming through. We know that for the next three to six months--perhaps much longer--we're going to see very difficult numbers through Statistics Canada that document the way the domestic economy is contracting.
You see bits and pieces of it. You're seeing the effects of men losing their jobs first because they're primarily being thrown out of commodity-producing jobs and manufacturing jobs. But we know that the next wave of job loss will be among women.
Though women make up 47% of the labour market, generally speaking they are paid much less than men. Canada has been a job creation juggernaut over the last 10 years. Between 1997 and 2007, Canada was the premier nation for job creation in the G-7. But not all of those jobs were well paid. In fact in the last few years we've seen the proportion of minimum-wage jobs grow in many jurisdictions. Those jurisdictions include Prince Edward Island, Nova Scotia, Quebec, Ontario, and Manitoba, all of which saw an increase in the proportion of minimum-wage jobs. Women take up 60% of those jobs. More than a third of those jobs are for prime-age workers, those 25 years and older, with an increasing proportion of those who are over 65 years of age taking up minimum-wage jobs.
So we have a problem on our hands in terms of the growth of minimum-wage jobs. There are 750,000 people working in minimum-wage jobs, and a lot of them are in the service sector, which is going to be hit. It is all that peripheral stuff you don't necessarily need to do when you're hunkering down. And we know that 60% of women are in those jobs.
That brings me to my next point about unemployment insurance benefits and the receipt of those benefits. In the high unemployment period of the 1970s, about 85% of the unemployed were covered and received benefits when they were unemployed. In the 1981-82 recession, that dropped to 76%. By 1990, when we were looking at the massive continental restructuring of our industrial capacity and people were losing their jobs in manufacturing and some commodity-producing industries, that number had gone back up to 83%. So 83% of the unemployed in the last recession were covered by unemployment insurance benefits. Between 1989 and 1997, that dropped precipitously from that proportion to 44%. That's basically cleaving it in half. So we are walking into this recession with 43% of the unemployed covered by unemployment insurance benefits.
There is another troubling trend, which is that we have rules in the unemployment insurance system that permit people to pick up some earnings and not be completely penalized. The proportion of people who are picking up jobs on the side, a little bit of work on the side, while being covered by unemployment, has also grown. That is more the case for women than it is for men, because you cannot live on 55% of low wages. So they are able to top up their wages by a certain amount. But that means that instead of unemployment insurance becoming a social insurance program to protect the unemployed, work has become a top-up to unemployment insurance. And when the jobs disappear, it will be exceedingly difficult for people to live on these forms of income support.
This leads me to my last point, which is that there are things we can do. The unemployment insurance system was scaled back dramatically between 1990 and 1996, but it can be expanded. We had massive expansions of unemployment insurance coverage in the 1950s and again in 1971. If this government and all parliamentarians were interested, with or without budgetary changes, you could make those changes right now by ensuring that more people are covered by the rules of entry; by expanding, actually, the shelter of some form of income support; and by improving income levels. If you won't improve the income replacement rate from 55% to 60%, you could be doing other things to ensure, for example, that the self-employed have coverage. You could, for example, double the refundable GST credit.
There are measures you can take to protect people against the storm. This is not just specific to women; it's for everybody, because women cannot support families on their own any more. It is going to take government intervention, and significant intervention, to prevent what is already a bad recession from developing into something far, far worse and that is utterly preventable. It would do our nation a great disservice if we didn't take this story very seriously.
Thank you very much for the opportunity to work with you today.
11:20 a.m.
Liberal
The Chair Liberal Hedy Fry
Thank you very much. That was excellent timing. You actually have about another minute and three-quarters to go.
Now we will have Ms. Lahey, who will present for 10 minutes. Ms. Lahey has given everyone a document that she will refer to. For those of you who want to find it, it's called “Budget 2009: Designed to Leave Women Behind--Again”.
11:20 a.m.
Professor Kathleen Lahey Professor, Faculty of Law, Queen's University
Thank you, Madam Chair.
Thank you to the members of the committee who are attending to discuss this extremely important issue.
I was surprised that apparently no other element of the federal government had taken these issues so seriously and relieved to see that this committee has begun at the place where I think everything should have begun when the discussions about how to adjust federal policy to the new economic realities began several months ago.
I'd like to make a series of points, all of which lead to my desire to convince you that although ten years ago Canada was rated number one in the world amongst all countries on the UN human development index, which measures key elements of social and economic development, and number one in the UN's gender development index for a period of four years, Canada has, for the last several years, been repeatedly singled out, studied, written about, and chastised by the Organisation for Economic Co-operation and Development, the OECD, which consists of 30 plus an extra couple of the most industrially developed countries in the world, by the International Monetary Fund, and by various agencies of the United Nations, including the Committee on the Elimination of Discrimination against Women.
Canada has come so far in moving away from the things that, as my colleague has just pointed out, had brought it both to a high level of economic development and also to a high level of equality between women and men on a number of other fronts, I think people still don't see the reality. I'll just give you one figure that stunned me a couple of weeks ago when I found it.
I was looking at the United Nations development program page that gives country updates. It was doing a 2008 update in order to bring the current economic situation into the frame. I was shocked to discover that as the UN statisticians developed a new index called the gender disparity index, which measures the sort of factual difference between the economic and social development that women enjoy as compared to that of men, Canada was ranked number 83 out of 157 countries. This is a long way from number one. It's a serious problem.
The problem arises very fundamentally from the way in which the employment insurance rules operate at the present time. The problem is not going to be solved by the strategies being proposed by the current government to deal with the issues. Until bold steps are taken to treat women as if they were full citizens and members of the human race in Canada, right along with men, and are equally as important, it's going to remain a very serious situation. I'll go through this as succinctly as I can to make this point.
In the handout that I've distributed, I've included a little graph on page 6 that shows the reality of income distribution in Canada. This is based on 2004 statistics. It could be updated for 2005; the picture won't look any different. If anything, it'll look a little bit worse. This represents the shares of cash money that flow through male versus female hands in Canada. This is the starting point of the problem, because women and men can come up with a thousand reasons why this is, or why it should be so, but the fact of the matter is that it hasn't always been like this in Canada. It doesn't have to be. It isn't in other countries. In fact, a very few social policy decisions would dramatically change this picture.
But the reality within which the employment insurance rules operate is shaped by the existing access that women and men have to money. The employment insurance rules are constructed within the existing reality and they simply recreate and reflect back the status quo; they can't change it. Except, as my colleague outlined, it did manage to happen in stages, beginning with the changes in the 1980s and the 1990s to the employment insurance system.
The key thing that has changed is that over the years the employment insurance system in Canada has been increasingly restricted to what we could call the standard employment model. It presupposes that everybody who works for money works in standard employment--a full-time permanent job with full benefits, 12 months a year, going on forever into the future or until something better comes along.
But a closer look at what has been happening to women as they have entered the workforce in staggering numbers over the last 30 years shows that we actually have two workforces. We have the standard employment workforce, which is substantially male dominated, however you look at the numbers. Here, men receive 60% of the cash money to be earned and women are left with 40%, and men hold over 60% of the full-time jobs and women have fewer than 40% of the full-time jobs. It's a segregated economy in which women have 69% of the part-time jobs and men have a very small share. So it's a very lopsided economy, and it explains why, if you look at the three main indicators of the status of women, women cannot work their way out of the spot they're in. Women already have to earn their 40% share of income by working part-time, sometimes in multiple jobs, sometimes in not-so-secure full-time jobs, and in addition they have to continue doing two-thirds of all of the unpaid work that gets done in Canada. That's a long work day, and they're poorly paid or not paid at all. And it's a work day that leaves the person who's worked the hardest with the least money in their hands.
What does the employment insurance system do to meet the needs of this extremely vulnerable group? At this point, based on the sequential changes that have taken place over the last 20 years, women have to approximate full-time employment to be able to receive maximum benefit from the employment insurance system. But even if they do that, because their own earnings will determine how much of an employment benefit they will get, they will only get employment insurance benefits that are approximately two-thirds or three-quarters of the amount that men will get. Men's maximum weekly benefit would be $413 a week. Women's would be approximately $312 a week, and that would be for a woman who is in a good situation. All the rest of the women are not getting employment insurance benefits. Women started out with coverage figures that were described by my colleague as more than 70 or 80%, but now some statisticians have calculated that only 32% of women who used to be covered by employment insurance would be now.
Those are the main points I wanted to make. As soon as you take the larger context of recent social policy and fiscal policy changes into consideration, and as soon as you start looking at the impact on women with multiple disadvantages, you begin to see that in fact the average woman that I've been talking about is a lucky woman.
Thank you.
11:30 a.m.
Liberal
11:30 a.m.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
Thank you.
There are so many questions and so many challenges here. Professor Lahey, you just concluded your comment by referencing the multiply disadvantaged woman. I wonder if you would expand on that and what this means to various groups, what the EI means, and whether you've done a study or dug down deeper.
11:30 a.m.
Prof. Kathleen Lahey
I can't say I've studied every group, but I have looked intensively at the situations of a number of them. The ones who stand out in my mind as needing some serious, focused attention are, first of all, new entrants into the workforce. Those workers include both immigrant workers—people who are new to Canada—and people who have just finished their education and are coming out of university with huge debt, if they've been so fortunate to attend. These workers have to establish 910 hours of eligibility before they qualify for establishing the minimum employment insurance benefits. So there is the whole question of the new entrants.
Secondly, I would say single parents are in a particularly invidious situation because the working income tax credit is constructed, just like everything else, around the image of the standard sort of male-breadwinner model, so there's no child care built into the working income tax credit to help people get in the door.
Aboriginal women have much higher, more intractable, lifelong levels of unemployment for a wide variety of reasons. The latest government allocation that was made to solve that problem was to give them a dedicated fund of 1.1% of the $600-plus million that were given to aboriginal groups that have been funded to run job training programs.
So there are huge disparities in different places, and the Canadian government has a history of just never doing anything about those particular situations.
11:35 a.m.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
Could you speak to the issue of self-employed or contract workers, not many of whom get EI, to the best of my knowledge?
Could you also speak to the issue of older workers? I have run into a situation where older workers continue to pay EI but can't claim it if they're already drawing benefits, like old age security or whatever.
Could you speak to those?
11:35 a.m.
Prof. Kathleen Lahey
Self-employed workers are an area of very great need, and in a way their needs—and particularly women who are self-employed, because they will earn less than self-employed men—particularly need consideration, because when they're unemployed or on maternity leave they have to replace themselves, where the entire business disappears and has to go into some form of liquidation.
People who are of retirement age are in a policy trap that has been constructed over the last several years. It works like this. If an older person is in a position to retire, the current economic situation is such that their financial adviser—their union or whatever—will recommend they see if they can keep working for another two, three, four years, to increase their contribution base so they will have a little bit higher income, as every pension fund goes through an asset valuation and commitment restructuring process.
This is all well and good for male workers who historically and statistically have higher incomes in the first place, but women who are in that situation are caught, because if they were to retire, they could instantly turn their spouses' income into a much larger income through the tax benefits of retirement income splitting, which at moderate- to high-income levels will give thousands of dollars of tax benefits to people in that situation.
So there are sort of second-level forces that are actually going to push certain women out the door. They won't get employment insurance and will become a tax shelter for their spouse.
11:35 a.m.
Prof. Kathleen Lahey
If they have a spouse. If they don't, then they fall into another category that is even closer to the edge. And although the amount that a person with a low income can earn without losing their guaranteed income supplement and old age security has gone up a little bit, it's not very much money. So there are serious problems in that area as well.