Precarious Employment, Health and Poverty in London Ontario

Joseph Michalski and Don Kerr

 

 

 

 

Introduction:   

She works "part-time" as a waitress for a locally owned restaraunt.  Her husband works for a manufacturing company for an hourly wage. His work pays $16 an hour with some benefits whereas she gets minimum wage with tips.   She also works "on-call" for a house cleaning service in the city. The household often find it very difficult to arrange child care given the unpredicatablity of working hours, particularly during the summer months.

She’s in her early thirties with a college degree, working for a transportation service company on-call through a subcontractor. She does similar work to many of her co-workers and reports to the same boss. The difference is that they get salaries, benefits, a collective agreement, and some measure of job security. She is paid only an hourly wage.

He worked in the financial services industry for 5 years prior to losing his job. Now he works from home, for a competing company, on contract.  He is self-employed person with no benefits or job security.

(Isabell and Mike can get some video which could be linked here?)


Precarious & non-standard employment 

The term “precarious work” has emerged in the lexicon of Canadians to highlght recent changes in the labour force.  What is certain is that the nature of employment in Canada is changing.   Over the past several decades, the standard employment relationship – based on full-time, secure work, where employees have access to good wages and benefits – has declined in importance.  In contrast, an increased proportion of Canadians are now employed in "part-time, temporary and causual forms of work".

Locally, a substantial share of Londoners at the lower end of the wage and skill spectrum are finding themselves struggling to earn a decent standard of living, with little job security and minimal control over their work conditions.  At the same time, there is a substantial share of well educated (often university or college educated) Londoners that are also having trouble landing that "full-time", "permanent" job, with benefits. The issue of non-standard work is not solely an issue of poverty and exclusive to low income residents of London, but also an issue for others who are relatively well trained and educated.

Where does our information on "non-standard work" and "precarity" come from?

 

Providing the broader context for the London Region

The London Region has faced some rather challenging economic condition since the turn of the century. Impacted by broader changes in the Canadian and North American economy, local labour-market conditions appear to be in a state of transition.  The issue of "job precarity" has been shaped by recent trends in terms of the supply and demand for labour.

The good news is that London's unemployment rate has declined to "pre-recession levels".

London ‘s unemployment rate has fallen substantially over recent years.  The economic recession hit London particularly hard in late 2008, with persistently high unemployment through to 2013. As has been true of many other parts of Canada, the economic recovery has seen employment growth (both in terms of full and part time jobs) and a reduction in the "unemployment rate". Yet while London's unemployment rate has declined, it is important to recognize that there are other economic indicators that do not paint as  positive a picture.

What the unemployment rate "does" & "does not" measure".

Changes in the unemployment rate can at times be misleading, as it focuses exclusively on persons who are classifed as being in the Canadian labour force. Using Statistics Canada's definition, the labour force includes only persons "who are currently working", or if jobless, "are currently active in some form of job search". If a person is jobless yet not seeking employment, then by definition, this person is not considered to be part of the labour force. 

Persons who exit the labour are subsequently no longer considered to be either "employed" nor "unemployed".  Hence, the "unemployment rate" can decline for two different reasons; it could decline due to a growth in the number of jobs available in a city, and/or quite simply, it could decline merely due to a reduction in the size of the labour force (as persons exit from the labour force altogether). The difficulty in the London context (as is true of Ontario overall) is that the labour force participation rate has declined as of late, to an extent that differs from many of its neighbors.  In drawing comparisons of the unemployment rate across regions and cities in Ontario, it is emphasized that not all regions have the same poportion of their population in labour force.

The uncertaintly in London is what proportion of persons outside of the labour force are not working due to choice (school, retirement, parenting of young children, etc) and what proportion might not be working due to circumstance beyond an individual's control (discouraged workers, forced retirement, incapable of working, etc).  Nor does the unemployment rate tell us anything about the quality of the jobs that Londoners have, including what proportion are working part-time involuntarily or how many might be employed in particularly "precarious" jobs.

Moving beyond the unemployment rate, employment growth in London has been relatively slow

London's low unemployment rate can draw attention away from the fact that the CMA has experienced a relatively poor performance in terms of employment growth. Over the last 15 years.  London's employment growth (with total jobs up by 11 per cent over the 2001-2017 period) has lagged behind cities closer to the Toronto area.  For example, Ontario's fastest growing census metropolitan areas (Barrie, Oshawa, Guelph, Toronto, and Kitchener-Cambridge-Waterloo) have all seen employment growth 3 to 5 times greater than London's (at 57.8, 38.7, 37.0, 34.4 and 32.2 per cent, respectively). Across Ontario’s 14 metropolitan areas, only Ontario's two more western CMA's (Windsor and Thunder Bay) have seen a slower rate of growth in terms of the total number of jobs available.

A smaller proportion of Londoners are currently working

While employment growth has been "relatively" slow in London, the city's population has also grown at a "relatively" moderate pace.  Yet while employment growth is up by about 11 per cent over the 2001-17 period, the CMA's population has actually risen at a slightly more rapid pace, up by about 14 per cent over this same period.  As a result, growth in the number of jobs available has not kept pace with growth in the number of people who might be seeking employment.

With this in mind, Statistics Canada also estimates on a monthly basis an alternative to the unemployment rate, i.e. the employment rate. This alternate indicator of local labour market conditions has the advantage of not limiting itself to those classfied as part of the labour force but more broadly considers everyone (i.e. the full population regardless of whether or not one might have entered or exited the labour force). This rate has declined as of late, partially due to population aging (as persons exit the labour force on retirement) but also due to the aformentioned job numbers. In addition, relative to other cities in Ontario, London's performance on this indicator has been relatively mediocre. 

Across Ontario's 14 CMAs, London's overall employment rate is second lowest, with fewer than 6 in 10 Londoners working in mid 2017 (58.5 per cent).

This is lower than both the provincial and national average, and does suggest that London has a more "challenging" job market relative to many of its neighbors. Yet in light of differences in age structure across CMAs (and the possiblity that lower rates might be explained by a higher proportions retired and/or attending college/university), it is useful to consider an alternate indicator of local labour market conditions.  As an indicator of the extent to which available labour resources (people available to work) are being used in the region, it is possible to estimate the employment rate of persons of "prime working age" (25-54 years).   As most people are finished their formal education by age 25 and very few persons retire prior to age 55, the employment rate focuses on exclusively those age groups whereby we would expect people to be in the labour force and working.  

Relative to a national average of over eight in ten 25-54 year olds employed, a much lower proportion of working aged adults in London are currently working. 

On this indicator, London's employment rate for persons of "prime working" ages has slipped dramatically over the last decade and a half, from 6th highest across 14 cities in 2001 to dead last in 2017.

While many Canadians think of London as being a relatively prosperous city in the industrial heartland of Ontario, the local economy has taken somewhat of a slide relative to other parts of the country as of late. In this context, it is logical that the competition for quality employment has intensified somewhat as the ratio in the number Londoners of prime working age relative to the number of jobs available has risen.  From a situation of relative prosperity a few decades ago, London is now closer to, and even lower than the national average on all sorts of economic indicators.

 

Non-Standard Employment in the London Region

 

 

 

 

 

The problem in this context is that the labour force can potentially shrink after prolonged periods of high unemployment (person becoming discouraged) or increase during periods of economic upturn (as persons feel the time is right to seek employment). 

SincDeclining unemployment in Southwestern Ontarioe its peak in 2001, the total number of manufacturing jobs in Canada have declined by roughly half a million, with over 60 per cent of this decline occurring in Ontario. As these are the jobs that historically paid well with workplace benefits, there has been considerable concern that the types of jobs that replace them are not of the same quality.  Concurrently, we have seen a growth in the number of workers in temporary employment (casual, contract and/or seasonal) — up to over 13 per cent of all persons employed.  Since 2001, growth in the number of part-time jobs in Canada (up 28.3 per cent) has outpaced growth in the number of full-time jobs (up 19.4 per cent).  As a result, roughly 1 in 5 Canadians are currently working part-time (sometimes by choice, but often due to the availablity of full time work)..

The terms “non-standard work” (or employment) and “precarious work” have both emerged in the lexicon of Canadians to highlght what appears to be a growing segment of the labour force.  In this context, the London Region has faced some rather challenging economic conditions as of late.  Impacted by broader changes in the Canadian and North American economy, local labour-market conditions appear to be in a state of transition. As London's manufacturing sector now has fewer persons employed, the city has actively promoted itself as somewhat of a technology hub with a focus on the Digital Creative sector. Both the health care sector and its universities and colleges remain major employers, as for example, the largest empmloyer currently in the city is the London Health Sciences center, wtih over 10,000 employees.  Recent months have shown reason for optimism, as for example, the most recent release from the Canadian Labour Force survey points to an unemployment rate of only 5.( per cent.

New jobs are not necessary good jobs, such that

In light of these, among other fundamental changes (climbing income inequality, persistent income poverty, and a declining share of  Londoners who appear to have "permanent & stable" employment, there is considerable interest in the state of precarity in the local London labour market.