Overturning the Precarity Penalty

The Poverty and Employment Precarity in Southern Ontario Research Alliance (PEPSO) released an important new report this past week. This mammoth study not only updates PEPSO’s detailed report published two years ago, it extends the analysis of precarity to the ways in which insecurity affects workers’ health, their families, and their children’s life chances. In the process, the report reveals the complex ways in which income and employment insecurity reinforce vulnerability and marginalization far beyond the workplace. The study is chock-a-block with insights and recommendations, many from the United States and Western Europe, for combatting precariousness.

As with the Workers’ Action Centre report released in March, many of the recommendations are explicitly aimed at the Ontario government’s review of the provincial Labour Relations Act and Employment Standards Act. The review comes in the wake of a decade and a half of profound transformation in Ontario’s industrial base and employment composition (see Kaylie Tiessen’s excellent 2014 CCPA-Ontario report for an overview). The long appreciation of the Canadian dollar punctuated by the 2008-09 recession ushered in falling output and employment in Ontario manufacturing and an expansion of low-productivity service-sector employment and self-employment. Fully 35% of employment growth since 2000 has occurred in sales and service occupations, in which the median hourly wage falls well below the low-wage threshold of two-thirds of the full-time median hourly wage earned by Ontario workers.

Ontario NOC-S median hourly wage and employment

In this context, the increase in part-time and temporary employment reflects the spread of business strategies that emphasize low labour costs, since employers are able to pay these workers less than full-time, permanent employees.

PT to FT ratio
Workers confined to non-standard employment are therefore commonly penalized on account of it. 45% of core age Ontario part-time workers would like to work full-time, but cannot find full-time work or secure more hours of work from their employer.

Involuntary PT rate

The PEPSO report proposes to eradicate the precarity penalty by simultaneously raising the productivity of low-wage private services and improving the incomes and conditions of the workers employed in those industries. In addition to raising the minimum wage and implementing a living wage, the report mentions the idea of precarity pay (requiring a 15-25% wage premium to compensate temporary and casual workers). It may also be worthwhile to examine laws preventing wage and benefit discrimination against part-time and temporary employees, and requiring the equal treatment of workers in different forms of employment. The Ontario labour law and employment standards review will not address the gender wage gap, which the Ontario government has committed to addressing. But it could in principle examine efforts in other countries to prohibit wage and employment discrimination against non-standard workers, some of which are outlined in the ILO’s 2015 World Employment and Social Outlook, also released this week.

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