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Toronto’s Poverty Reduction Strategy can make progress on decent work

September 21, 2015

3-minute read

This fall, Toronto City Council will be voting on a plan to implement a Poverty Reduction Strategy called TO Prosperity. The plan has a number of innovative measures targeted to reducing working poverty.

Now is a good time to act: income inequality is worsening at twice the pace as the national rate, according to a recent United Way of Toronto report.

And in a paper for the Metcalf Foundation, John Stapleton documents that Toronto has the highest concentration of working poverty and the fastest growth rate in working poverty.

John provides us with a stark characterization of Toronto. He describes the city as a giant modern-day Downton Abbey, where a well-to-do knowledge class relies on a large cadre of working poor at their workplaces—where they pour their coffee, serve their food, and clean their offices. And at home—to maintain their gardens, mind their children, and clean their houses.

Poverty wages are just one part of the equation in Torontonians’ experience of working poverty. The Workers’ Action Centre has documented the rights violations that are routinely associated with low-wage work.

In our research at CCPA-Ontario, we document the prevalence of low-wage work, unpredictable hours, and the lack of paid time off province-wide. We have also documented that this low-wage work is not distributed randomly through the population but, rather, that it is concentrated among workers who are racialized, recent immigrants, and women.

The causes of increasing working poverty are many, and complex. But there are steps that the city can take—concrete, achievable measures that build on the city’s existing policies. The interim poverty reduction strategy does a good job of laying out a workable blueprint. All that’s left now is the political will to support it.

A focus of the strategy is on the city’s role as an employer; it also draws on the city’s buying power to reduce poverty and support quality jobs.

A centrepiece of this part of the strategy is a commitment to make the City of Toronto a living wage employer and require city contractors to become living wage employers, too.

Here’s why it’s important: as a complement to a province-wide higher minimum wage, a living wage can be an essential component to reduce working poverty.

In support of that goal, we recently updated our calculation of the living wage for Toronto, which shows that costs like child care and housing are so high, the provincial minimum wage falls vastly short for families trying to make ends meet.

Stepping up to make the City of Toronto a living wage employer would build upon long-standing city policies, such as the fair wage policy. Importantly, the proposal to become a living wage employer extends beyond city staff to contractors.

We know that contracted services, such as cleaning, security, and food preparation are very low-wage, precarious sectors. Extending this policy beyond city staff to services that the city purchases will raise the floor for both employers and workers in these sectors.

Another strength of the interim poverty reduction strategy is that it recognizes that becoming a living wage employer is only one piece of a larger puzzle in the city’s role in reducing working poverty.

Regular hours of work, working conditions, occupational health and safety, and opportunities for advancement are also crucial. And these kinds of job quality concerns are not limited to the private sector.

We found that out in a research study on the impact that contracting out city services can have on public sector workers. Those who were affected by contracting out saw their work hours and their incomes reduced, they had less access to benefits, and they experienced negative impacts on their health and family lives.

This points to the importance of the interim strategy’s proposal for the city to develop and apply a job quality index both to contractors and to jobs in the city itself. This index would measure and rank jobs on conditions that move beyond wages to: hours of work, working conditions, occupational health and safety, and opportunities for advancement.

The city should use this tool both in procurement policies and to evaluate its own labour relations decisions.

The interim strategy also proposes to leverage the city’s spending power by developing and implementing social procurement and community benefit agreements. These agreements are a newer development here, but they have a longer history in the United States. Implementing these policies would put Toronto at the forefront in using existing spending more effectively to reduce working poverty—and to encourage private sector to become fuller partners in poverty reduction.

Work has begun on both of these strategies: the city has developed a social procurement strategy and a framework agreement for community benefits has been negotiated for the Eglinton Cross Town with the Toronto Community Benefits Network.

Two recent Atkinson Foundation papers provide practical advice on how to advance these kinds of policies further.

These proposals in the poverty reduction strategy are both innovative and doable. They do not require large financial commitments or depend on commitments from other levels of government. Yet, they are policies that can have an immediate, positive impact on the lives of marginalized Torontonians.

Coupled with meaningful investments in the rest of the strategy, Toronto could become a working example of how a municipality can help lead the way in Canada to reduce income inequality and working poverty. Even more so if the provincial and federal government step up to the plate as a partner.

Sheila Block is a senior economist with the Canadian Centre for Policy Alternatives’ Ontario office. Follow Sheila on Twitter:  @SheilaBlockTO.


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