Thank you very much, Chair, and thank you to everybody who has been spending all day listening to witnesses.
I know it's hot and I know it's the middle of the summer, and I know that we're all really struggling. I thank you very much for your time and the invitation to bear witness to this august committee. I hope you can change the world because we need you to do that.
A month ago, the Bank of Canada told us that the worst could soon be over for the economy—great news. Of course, the pace of rebound and getting back to so-called normal is far from certain. For Canadian workers, recovery just can't come soon enough, as both Anita and Rhonda have said.
In April's labour force survey, StatsCan said that more than a third—36.7%—of the potential labour force did not work or worked less than half of their usual hours. May, a month ago, showed that we had more of a “he-covery” than a “she-covery”, that is, more men returning to work than women. On Friday, when the next labour force stats come out, let us hope that the stories we are all hearing don't translate to more women simply giving up and dropping out of the labour force because they just can't juggle everything and do child care and home-schooling too.
The trends are deeply problematic for households and for the potential of the economy. This isn't a feminist issue. This is a macroeconomic issue. That's because household spending accounted for over 56% of GDP before the pandemic struck. It's been a growing driver of GDP for some time because we've been exporting less and businesses have been investing less, which leaves only the household sector and government actions to continue to help GDP grow.
Household purchasing power propels the Canadian economy, and women's incomes are critical to maintaining household purchasing power. Women have been asked to pull more weight over the last few decades. By around a decade ago, we made up half the employed workforce. Women's incomes are really critical to maintaining household purchasing power, but we have a lot of women who were deemed non-essential during the shutdown, the majority of whom were women who are going to find their way back to being rehired blocked because the limiting factor for women's return to work is child care. Mathematically speaking, it is simply impossible for us to get to recovery, to regain GDP or the number of jobs, without women coming back fully able to return to work.
Simply put—sing it with me now, because this is the smash summer hit of 2020—there will be no recovery without a she-covery and no she-covery without child care. Let me be really clear. If we don't do this, we are actually voting to move towards economic depression—and not a recession but a prolonged contraction of GDP—by policy design. You can't turn around to your colleagues in any of your parties and say that you didn't know, because I've just told you, and there is no way, mathematically, that it can happen differently.
On the acceleration of shovel-ready infrastructure, sure, that will help speed recovery. That's fantastic, but mathematically you cannot get growth in primarily male-dominated jobs to offset the number of jobs lost by women. Furthermore, you can repair all the critical physical infrastructure you want, but if you're just standing by and doing nothing about the loss of critical social infrastructure, you are not doing your job, and that is exactly what we are poised to do.
User fees for child care represent the second-biggest cost for young families, second only to housing expenditures. Many families who lost their incomes forfeited their spots in child care facilities because of the high cost for simply holding onto something that they weren't using. Child care costs will undoubtedly also rise because of the new requirements for physical distancing, dramatically increasing staff-to-child ratios and adding new fixed costs for space, PPE and cleaning.
We don't know what share of our ecosystem of child care, which in Canada is operated through the public system and through the private not-for-profit and private for-profit providers, is going to shutter in the wake of the pandemic, because we don't measure it. In the United States, they've estimated that half of their ecosystem of child care is at risk. In other words, four and a half million spaces out of nine million spaces are about to shutter. It would cost $9.6 billion every month just to hang on to the capacity they have. Also, of course, the fewer the spaces, the less the ability for women to return to work even when they have a job.
The irony, my friends, is that subsidized child care literally pays for itself. A study by noted Quebec economist Pierre Fortin showed, in 2008, that for each $100 of day care subsidy paid out by the Quebec government, the Quebec government generated a return of $104 for itself and a windfall of $43 for the federal government, which didn't put in one thin dime. It literally paid for itself.
Child care can indeed play a threefold role in recovery. Beyond simply facilitating women's return to work and indeed being a source of employment, the decision to ensure that child care is affordable and that high-quality early learning is accessible to all families is going to maximize the future of the next generation of Canadian children, who in turn will be asked to lift up people too old, too young and too sick to work. That would lower public spending and increase revenues for governments and society. It pays for itself in the short term and in the long term.
We may choose not to act, as the federal government—or not—but we will reap what we sow. The U.S. data provocatively shows the return on investment on spending on child care. Subsidized, high-quality early learning education for kids who are at risk returns between four dollars and $8.75 on each dollar invested in that type of child care. It's not a warehouse to make sure mommy can go to work, but a system that is targeted to neighbourhoods where kids are more at risk of entering school not learning ready and of not being supported when they are in school to continue to learn.
The impact also doesn't end with preschoolers. Canadian data, our own evaluation, shows that spending on pathways to education, which has been supported by both Liberal and Conservative governments but never made the norm, has resulted in a net benefit of over $2,000 for governments over and above what they spent per student in the program, and almost $5,500 for individual students. It's a winner.
Why aren't we doing this? What is the resistance to this? We are literally leaving money on the table by not using the opportunity that we have right now to improve our social infrastructure. By rolling out accelerated initiatives in our biggest cities first, which have the biggest concentrations of children and the highest concentrations of poverty, we could maximize our collective potential and our individual potential.
Across society and per person, we could improve our future by investing in child care. Getting everyone learning ready and learning supported as they age has to be a 21st-century requirement because the population is aging. As a shrinking working-age cohort is asked to do more for growing numbers of people who are too old, too young and too sick to work, we can't afford to discount the skills development of anybody. This means the supply of high-quality early learning child care should not be left to market forces to decide what is our choice, but rather integrated with the public education system because it is a public good that is undersupplied by markets chronically.
I believe that, given the circumstances, this requires a national approach and a federal role—and I get that it's controversial. Why would you put the feds in charge of child care or having any role in child care when it falls, constitutionally, into the provincial jurisdiction?
I have an answer for you. It's because child care is more costly to operate safely in the post-pandemic world, because provinces and cities are cash-strapped, because the federal government provides funding also for health care and post-secondary education and runs EI, and because even if we don't raise taxes to pay for it immediately due to the post-pandemic fiscal pressures, debt by the federal government is the least risky and the lowest cost of any debt held by any economic agent in society: households, businesses, municipalities and provincial governments. We would be crazy not to do this, even if it required borrowing to do it.
I would be remiss not to mention the number of recent immigrants and migrant workers who have been made sicker and even died because of the pandemic and inadequate provisions for safe reopening. We need—