CITIZENS  for  PUBLIC JUSTICE <ul><li>The Great Recession: </li></ul><ul><li>What Happened to Economic Security in 2009? <...
The Great Recession
The Great Recession Poverty and Unemployment Rates, 1976-2007
The Great Recession <ul><li>2008-2009 recession: </li></ul><ul><ul><li>Unemployment increased from 6% in 2007 to 8.5% in 2...
The Great Recession <ul><li>Unemployment: </li></ul><ul><ul><li>Over 400,000 jobs lost </li></ul></ul><ul><ul><li>Those al...
The Great Recession <ul><li>Employment Insurance: </li></ul><ul><ul><li>Coverage increased from 43.4% to 51% </li></ul></u...
The Great Recession
The Great Recession
The Great Recession
The Great Recession Change in social assistance caseloads
The Great Recession <ul><li>Employment and income </li></ul><ul><ul><li>The recession increased the proportion of precario...
The Great Recession <ul><li>Cost of living </li></ul><ul><li>Food prices increased by far more than core inflation in 2009...
The Great Recession
The Great Recession <ul><li>Cost of housing </li></ul><ul><ul><li>Average rent rose 2.3% between October 2008 and October ...
The Great Recession Consumer Bankruptcies and Insolvencies
The Great Recession <ul><li>Food bank use </li></ul><ul><ul><li>18% increase – largest year-over-year increase on record <...
The Great Recession <ul><li>Lessons for basic income: </li></ul><ul><ul><li>Without changing the status quo, we will keep ...
The Great Recession <ul><li>Bearing the Brunt:  </li></ul><ul><li>How the 2008-2009 Recession Created Poverty for Canadian...
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The Great Recession? What Happened to Economic Security in 2009

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Presentation at the BIEN conference in Montreal, April 16, 2010

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  • Based on a paper coming out next week looking at poverty trends during the recession. 10 key economic indicators: unemployment, Employment Insurance, social assistance, employment, income, cost of living, housing, debt and bankruptcy and food bank use.
  • Historic correlation between poverty rate and unemployment rate Except for a three year divergence following the last recession – attributed to changes in UI, which became EI, and changes to welfare Following three year divergence, rates returned to their habitual correlation, except farther apart
  • Unemployment actually peaked at 8.7% in August 2009 Increase in poverty rate represents an additional 900,000 Canadians, meaning that more than 3.9 million people are now in poverty Last recession: initial recovery of 6 months was followed by another 6 months of declining employment Without concerted government effort, it could take years for unemployment and poverty in Canada to decline to their 2008 levels
  • Job loss is from October 2008 to October 2009 More men than women lost their jobs, but parents of young children suffered heavy job losses – over 153,600, both two-parent families and single-parent families
  • Numbers are from October 2008 to October 2009 Despite increase in coverage, nearly half of the unemployed are still not receiving EI benefits As many as 500,000 workers have likely exhausted their benefits by now without finding new work Maximum benefit available is $447 a week; average benefits during the recession were $343.80 a week. Both are a poverty income if a household does not have another source of income.
  • Ontario, Alberta and BC had the largest job losses and significant increases in unemployment
  • But they also had the lowest coverage of EI, both at the beginning of the recession – and despite changes in coverage throughout the recession – towards the end of the recession
  • Increase in social assistance caseloads across the country correlated with EI coverage – those provinces with the lowest EI coverage had the highest increase in welfare caseloads, and those provinces with the highest EI coverage had the lowest increase in welfare caseloads.
  • Social assistance caseloads increased across the country. 8 provinces had their 2009 peak month in December; 7 of these 8 have already published an increase in January 2010. Suggests that we haven’t seen the summit yet for rising caseloads – particularly as EI benefits are running out.
  • Prior to the recession, 1 in 3 jobs was precarious or non-standard We lost more full-time jobs than part-time jobs during the recession. Job creation in the past 6 months has been more part-time than full-time (January and March – both months we lost full-time jobs, but had net job growth because there were so many part-time jobs created). Permanent jobs replaced with temporary jobs 3.9% growth in self-employment Average wages increased, but largely due to decline in lower paid employment. Actual take home earnings of part-time workers increased less than inflation because of reduction in working hours Lowest income deciles lose proportionally far more of their income during a recession, and don’t recover as well as higher income deciles.
  • Four of these items – flour, bananas, baked beans and baby food – increased more than 20% between December 07 and December 09.
  • Average debt per household increased 5.7% in 2009 Consumer bankruptcies rose 36.4% between the third quarter of 2008 and the third quarter of 2009 Consumer insolvencies (bankruptcies + proposals) grew at the same rate
  • The Great Recession? What Happened to Economic Security in 2009

    1. 1. CITIZENS for PUBLIC JUSTICE <ul><li>The Great Recession: </li></ul><ul><li>What Happened to Economic Security in 2009? </li></ul><ul><li>Chandra Pasma </li></ul><ul><li>Policy Analyst </li></ul><ul><li>chandra@cpj.ca </li></ul>
    2. 2. The Great Recession
    3. 3. The Great Recession Poverty and Unemployment Rates, 1976-2007
    4. 4. The Great Recession <ul><li>2008-2009 recession: </li></ul><ul><ul><li>Unemployment increased from 6% in 2007 to 8.5% in 2009 </li></ul></ul><ul><ul><li>Poverty rate has likely increased from 9.2% in 2007 to 11.7% in 2009 </li></ul></ul><ul><ul><li>It took almost 8 years after the last recession for unemployment to decline </li></ul></ul><ul><ul><li>It took 14 years after the last recession for poverty to decline </li></ul></ul>
    5. 5. The Great Recession <ul><li>Unemployment: </li></ul><ul><ul><li>Over 400,000 jobs lost </li></ul></ul><ul><ul><li>Those already economically vulnerable suffered disproportionately </li></ul></ul><ul><ul><li>1 in 4 workers making less than $10 an hour lost their job </li></ul></ul><ul><ul><li>Those with high school education or less, recent immigrants and Aboriginal peoples had heavy job losses </li></ul></ul>
    6. 6. The Great Recession <ul><li>Employment Insurance: </li></ul><ul><ul><li>Coverage increased from 43.4% to 51% </li></ul></ul><ul><ul><li>Number of recipients increased from 500,340 to 809,600 </li></ul></ul><ul><ul><li>But number of unemployed not receiving EI increased from 650,760 to 777,400 </li></ul></ul><ul><ul><li>Benefits are a poverty income </li></ul></ul><ul><ul><li>Regional distortions in coverage </li></ul></ul>
    7. 7. The Great Recession
    8. 8. The Great Recession
    9. 9. The Great Recession
    10. 10. The Great Recession Change in social assistance caseloads
    11. 11. The Great Recession <ul><li>Employment and income </li></ul><ul><ul><li>The recession increased the proportion of precarious work </li></ul></ul><ul><ul><li>Growth in average earnings for part-time workers did not keep pace with inflation </li></ul></ul><ul><ul><li>Recessions increase the income gap </li></ul></ul>
    12. 12. The Great Recession <ul><li>Cost of living </li></ul><ul><li>Food prices increased by far more than core inflation in 2009 – 4.9% vs. 0.3% </li></ul><ul><li>The price of 13 basic dietary staples increased more than 10% between December 2007 and December 2009. </li></ul>
    13. 13. The Great Recession
    14. 14. The Great Recession <ul><li>Cost of housing </li></ul><ul><ul><li>Average rent rose 2.3% between October 2008 and October 2009, compared to inflation of 0.1% </li></ul></ul><ul><ul><li>Rental affordability declined in 11 major urban centres </li></ul></ul><ul><ul><li>In 10 major urban centres, median rent is 30% or more of the median income earner’s income </li></ul></ul>
    15. 15. The Great Recession Consumer Bankruptcies and Insolvencies
    16. 16. The Great Recession <ul><li>Food bank use </li></ul><ul><ul><li>18% increase – largest year-over-year increase on record </li></ul></ul><ul><ul><li>794,738 people used a food bank in March 2009 </li></ul></ul><ul><ul><li>The number of food bank users is close to the record set in 2004, meaning the gains of the past 5 years have been totally undone </li></ul></ul>
    17. 17. The Great Recession <ul><li>Lessons for basic income: </li></ul><ul><ul><li>Without changing the status quo, we will keep seeing poverty rise and fall with the economic cycle </li></ul></ul><ul><ul><li>Work doesn’t provide security </li></ul></ul><ul><ul><li>Precarity of the labour force is increasing </li></ul></ul><ul><ul><li>EI is totally inadequate </li></ul></ul><ul><ul><li>A basic income program needs to be indexed to cost of living, not core inflation </li></ul></ul>
    18. 18. The Great Recession <ul><li>Bearing the Brunt: </li></ul><ul><li>How the 2008-2009 Recession Created Poverty for Canadian Families </li></ul><ul><li>Available at www.cpj.ca/bearingthebrunt </li></ul><ul><li>or email [email_address] </li></ul>

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