Working Poor in Canada - Essay Example

Sociology 1006E Working Poor in Canada Lecturer: presented: The Face of Poverty in Canada Today Canada is a nation in which some segments of the general public live in poverty. These comprise mainly the physically and mentally challenged, single mothers, new immigrants and native Canadians, whose income rates remain low. The consequences of poverty are wide-ranging such as deteriorating health, drug and substance use, increased crime, violence and suicide among other negative aspects in the society. The consequences of poverty in the country are because of the lack of official poverty measurement technique by the government and therefore there are no particular poverty lines, which makes hinders the efforts to identify the appropriate interventions to reduce poverty among the most vulnerable groups (McQuillan & Ravanera, 66). Lee observes that poverty rose by 28.6% between 1990 and 1995 when there was a notable increase (6.1%) in the country’s total population (57). This increase was far more than economic growth in the country within that period. The metropolitan urban areas such as Montreal and Vancouver among others are inhabited by majority of the poor. Poverty among children and the youth, the aged and women is high which is indicator of the impact of poverty in the country due to the fact that children and the youth are the majority in the nation’s population. Majority of people with low levels of education such as below secondary are poor, even though there are more than 8% of poor people in cities who have attained post secondary education. The level of skills is also a major determinant of the poverty prevalence in the country, with the people with low skills being vulnerable to poverty (Beaujot & Kerr, 78). The country is faced with extensive layoffs as well as a reduction in permanent employment, downsizing in companies and declining social assistance rates. These have contributed to the rising levels of poverty. Globalization has significantly contributed to these occurrences especially with the improvements in communication, transport network as well as liberalization of trade, which has led to increased competition for the Canadian industries. Investors shifted their investment to the third world countries that apart from the low competition provide cheap labor compared to the Canadian labor force. This led to the closure of most companies in the country, thereby reducing employment opportunities especially for the unskilled labor (Liu & Kerr, 116). Moreover, there is an increasing trend towards computerization of most operations in many organizations, which is another major factor that has led to a reduction of the labor demanding employment opportunities. Even though production in the country has increased, thousands of people who would be working in the companies have been replaced by computers and are now languishing in poverty. However, poverty can not only be blamed on globalization and computerization. Rather there is also a big difference between the highest paid skilled workers and the lowest paid unskilled workers, who form the bulk of the poor population. The service industry has not yet been unionized and the unskilled workers earn meager salaries that are barely enough to cater for their basic needs. The full time permanent jobs in Canada are mainly for the highly skilled workers who can match the highly competitive labor market. Nevertheless, such opportunities are not many; hence even the skilled people are also being compelled to take up part time as well as other low paying jobs that have little or no job security. Further, the marginalized groups such as the physically challenged and the disadvantaged do not get any support to get employed even in the low paying jobs (Liu & Kerr, 115). Working poor and the Evidence of their Growing The working poor are generally defined as people and families who are employed generally but are unable to get rid of poverty in their lives. They earn a salary that does not help them to satisfy their basic needs. There are usually a higher number of dependants than the worker’s income can cater for. There is a difference between the working poor and the paupers who live in abject poverty through the government’s assistance in Canada. The working poor are regarded as people who are capable to meet most of their needs, and that their capacity can be enhanced by improvements in the economy. For example, a person who earns $300 per month may be unable to meet all the personal and family needs when the inflation rate in the country is high. However, if there are general improvements in the economy that can lower the inflation, and hence a decrease in the prices of commodities, the working poor who earn the $300 per month can meet more of their needs (Brian & Katherine, 107). The government may therefore not be compelled to offer aid to such people. The absolute poverty level is usually the basis for evaluating the working poor. However, determining the number of working poor in Canada is usually difficult especially due to the fact that there is no poverty line that can be used as a reference point of poverty such as in the US. The working poor in Canada are generally classified as the low wage earners who lack the needed skills for higher wages. In most cases, they usually work part time or spend most of their time searching for employment opportunities (Human Resources and Social Development Canada, 47). In other words, they earn their living through out the year through moving from one company to the other. Even though they may be engaged in part time work, a combination of all the hours worked in the various companies is similar to full time employment. Due to their employment status, they are not entitled to employment benefits such as health insurance. Working for minimum wage is one factor that is viewed as the cause of the high number of working poor in Canada. Anderson notes that the minimum wage earners increased by 0.5% between 2000 and 2008 (57). No improvements have been made do check the rise and therefore it might be higher in the next 8 years. On the other hand, Canada is rated among the countries with a great difference between the high income earners and the working poor. This means that the GNP is likely to give the wrong impression due to the disparities in the distribution of income. Compared to other OECD countries, the spending towards improvement of worker’s benefit is low. The increasing trends of people who are working relying on the nation’s food bank are an evidence of the growing number of the working poor. In 2006, Hunger Count (2006) reported an increase of 0.3% among the workers who were clients of the food bank in a period of 1 year. Wages have not improved over a long period of time and companies have not shown a sign of improvement, which indicates that the number of working poor is likely to continue rising especially due to the fact that the cost of living continues to rise. Jobless Recovery as well as its Implications for Society in General After an economy recovers from an economic downturn, investors try to maximize production to compensate for the low production in the recession. Under such situations, industries expand their operations leading to increased Gross Domestic Product (GDP) without creating new employment opportunities. The level of unemployment usually goes up during the recession as companies try to cut back on their expenditure. This level is maintained even after the period of downturn (Allahar, 43). Even the employment opportunities arising as the industries recover are reserved for the best individuals who are expected to generate immediate profits for the organization, which means that even the former employees in companies may remain jobless as fresh graduates who may not demand high salaries and are likely to inject fresh knowledge in the organization are taken. The entire situation is regarded as job recovery. Jobless recovery is a major problem for industrial economies especially due to the fact that the majority of the people usually depend on employment for their existence (Beaujot & Kerr, 77). The Canadian people need something to do on a day to day basis to maintain good health. In essence, lack of employment leads to idleness and stress, more so when the cost of living is high and individuals have no money to purchase the goods being produced by the recovering industries. There is need for something to generate self esteem and contentment for individuals in the society and therefore job recovery may not be the best for them. Isaak views job recovery as a period of relaxing after scarcity in which people can do volunteer work and engage in cultural activities (63). However, voluntarism is usually not real since if there could be work for the people, they would happily be employed. Job recovery is a situation that raises concerns even as human beings desire to develop new techniques and machines to make work easier. The more the machines that can perform the work of a human being, the more the society continues to suffer from loss of job. In essence, the industrialist is the one who enjoys the reduction in the expenditures on employees and the efficiency that results from mechanization. Technological advancements continue even when a recession occurs in the country such as in the current global economic crises that have also affected Canada. Downsizing in industries may take long enough as long as the recession persists, and the technological inventors usually assume the responsibility of providing an answer to counter the losses made. They offer a new direction of production that is likely to generate income faster. More investments are made in terms of new technology, which replaces the employees. In essence, when a recession comes to an end, industries begin thriving thereby generating the demand for employees. However, in a job recovery, fewer employees are needed (Beaujot & Kerr, 81). The recovery adversely affects the working poor in an economy as employers begin to apply part time employment and job sharing instead of complete downsizing. In such a situation, the working poor face a further reduction on their salaries as they begin part time employment. Benefits are reduced and the workers live in uncertainty regarding their employment. Moreover, the poor who are mainly the less skilled people who have not been educated beyond secondary level may ever have a chance of filling the newly generated employment opportunities that require highly skilled people. The Gap between the Rich and the Poor In general, the gap between the rich and the poor will continue to enlarge because more industrialists are able to generate much profit from the increased production while minimizing the cost of labor. The rich capitalists who own the industries usually take advantage of the poor during a jobless recovery situation. They only utilize them where the new technology may not be applied. When the tasks are accomplished, the working poor have to wait for another opportunity to work. The major problem is usually the fact that there is no continuity in employment. Moreover, so many poor people tend to compete on the few available positions thereby making it possible for them to increase production with ease especially since as more people create a glut in the labor market, the cheaper the labor, which obeys the law of demand and supply (Ruth et al. 12). The more the capitalists who are the owners of the industries are able to offer employment to the poor, the more their capability to manipulate and influence them for their own gains. To effectively control the poor and continue getting cheap labor for production, the industrialists empower a few individuals economically through offering better salaries. Such actions lead to a large group of poor people who are dependent on a few who are rich and powerful. In Canada, the rich are able to maintain their status since they play a significant role in the sustenance of a nation’s economy. In essence, a government is supposed to act on the behalf of the citizens to ensure that they access basic services such as healthcare, better housing, infrastructure and security among other essentials that are needed by any society. Banerjee et al. observe that for the national goals to be accomplished, the government has to encourage major players in the economy to support its policy objectives for development (253). The industrialists are encouraged to participate in development activities through corporate social responsibility, philanthropy towards government projects and cooperation. In a way, the taxes paid to the government, and the industrialists’ contribution to the development of infrastructure helps the government to cater for the needs of the general public. However, policy formulation is affected by the owners of the industries as the government continues to encourage and create a favorable environment for investment. Tariff barriers are relaxed, labor unions are suppressed and the interests of the industrialists are put ahead of those of the poor citizens, which widens the economic gap between the rich and the poor (Isaak, 72). The Functionalist and the Political Economy Perspective The functionalist perspective of poverty applies in explaining the persistent poverty and the ubiquitous gap between the rich and the poor. In essence, there were no poor people, there would be no one to work in the industries for a low wage and therefore investors would be forced to move to other regions where people were poor and willing to work for the wages that the employer can comfortably pay. When investors are absent and people do not work, the society can not be complete. There can be no rich people and therefore there would be no production. People would suffer from lack of industrial products in the economy. In real meaning, the functionalist perspective postulates that poverty helps to maintain social balance (Ashworth & Long, 51). The political economy perspective on the other hand explains the fact that it is the poor people who seek employment to earn money to cater for their personal needs as well as those of their families. Even when the employers offer meager salaries, people still seek employment without legal compulsion. In essence, they have liberty to choose the employers who pay well, but they remain bound by their poverty to continue working for meager salaries. As long as there will be poverty in the society, people will continue to work for the rich industrialists in Canada and the gap between the rich and the poor will remain (Banerjee et al. 241). References Allahar, A. Richer and Poorer: the Structure of Inequality in Canada. Toronto: J. Lorimer, 1998.  Anderson, R. B. “Entrepreneurship and Aboriginal Canadians: A Case Study in Economic Development”. Journal of Developmental Entrepreneurship. 7.1 (2002): 45-66. Ashworth, L. M. & Long, D. New Perspectives on International Functionalism. International Political Economy, Palgrave Macmillan, 1998 Banerjee, A. V., Paul J. Gertler, and Ghatak, M. “Empowerment and Efficiency: Tenancy Reform in West Bengal”. Journal of Political Economy, 110.2 (2002): 239-280. Beaujot, R. & Kerr, D.  Population Change in Canada.  Toronto: Oxford University Press, 2004. Brian, H.R. & Katherine, C. “Child Poverty in Canada and the Rights of the Child”. Human Rights Quarterly. 25.4 (2003): 107. Human Resources and Social Development Canada (HRSDC). Low Income in Canada: 2000 2002 Using the Market Basket Measure. Ottawa, 2006. Isaak, R. The Globalization Gap: How the Rich Get Richer and the Poor Get Left Further Behind, FT Press, 2004 Lee, K. Urban Poverty in Canada: A Statistical Profile. Ottawa: CCSD, 2000. Liu, J. & Kerr, D.  Family Change and the Economic Well-Being of Recent Immigrants to Canada.  International Migration, 41.4 (2003): 113-140. McQuillan, K. & Ravanera, Z. R. Family Transformation, Social Capital and Social Cohesion. Toronto: University of Toronto Press, 2006. Ruth, D., Shearer, R. & JoLynn, R. “The new face of poverty in Canada - implications for health care professionals”. Leadership in Health Services, 13.3 (2000): 10-13 Read More