Racialized workforce has highest percentage of working poor in Toronto

By: Zandile Chiwanza on November 27, 2019

Despite historically low unemployment levels and a robust job market in Toronto, the number of individuals whose jobs don't pay the bills or are on social assistance is on the rise, with the Black community especially affected.

Though 46% of Toronto’s total workforce is racialized almost two-thirds of those living in working poverty — 63% — are racialized, according to a new study by the Metcalf Foundation — The Working Poor in the Toronto Region: A closer look at the increasing numbers.

“While they hustle to stitch together the pieces of their working lives as security guards, cleaners, line cooks, cashiers, housing costs continue to rise faster than wages,” the report said. 

“And over the past decade the cost of other necessities — like nutritious food — has increased far ahead of inflation, exacerbating the challenges facing Toronto’s working poor.”

Written by Metcalf Innovation Fellow John Stapleton, with contributions by Dr. Carl James and Dr. Kofi Hope, the goal of the report is to highlight the realities of working poverty in the region and providing an overview of the factors driving the continued rise in numbers. The 2016 Census of Canada and the Canadian Income Survey (CIS) were used as sources for this report.

“The fact that we would still be having an increase in working poor when the minimum wage has gone up, with unemployment so low, with extra benefits, and the working income tax is alarming,” Stapleton said in an interview. “Considering all those things working poverty should go down.”

According to the Toronto Star, the foundation defines the working poor as people between the ages of 18 and 64 who are not students, are living independently and have an annual after-tax income between $3,000 and the Low-Income Measure of $22,133 in 2015, the year the most recent census was taken.

The report found that working poverty for White males was 4.8% and 4.7% for White females compared to racialized populations, it was 11.1% for males and 8.2% for females in 2016. 

The highest rates of working poverty, by ethnocultural group and gender, were among South Asian males, Black males, and Black females. 

Of the four largest racialized groups only the Black community experiences higher rates of working poverty in subsequent generations. This increase is particularly pronounced among Black Canadian-born females, whose rates of working poverty rose from 9.7% in 2006 to 12.2% in 2016.

“The usual narrative is that new immigrants fare less well than their children. And second and third-generation descendants tend to do even better and are more apt to prosper in their new country,” the report said. 

The data “indicates that this is true among most racialized communities but not for the Black community born in Canada, who overall do less well and display higher levels of working poverty.” 

Of all the ethnocultural groups, Black workers are more likely to commute for longer than an hour to work — the implications of which are costs associated with travel and time away from home and family. 

This distance is increasing as many people are priced out of owning homes in every single Toronto neighbourhood and are moving into houses in the suburbs and commute to work in the city.  And the cost of commuting, mortgages, and childcare contribute in part to the economic situation.

“These trends ought to be considered unacceptable anywhere, and definitely in the wealthiest and most diverse metropolitan area of an affluent nation,” the report said. 

Underemployment, growth in low-wage service sector jobs, fewer hours available to each worker, and layoffs are part of what is driving the growth of working poverty.

“We need a variety of solutions,” Stapleton said. “Better income security that we're that I think we're going to get through the Canada Workers Benefit and we certainly need better employment insurance.”

With the decline in permanent employment and the rise of precarious employment, career advancement has become a less frequent option and more entry-level jobs become dead-end positions. On a practical level, Stapelton urges employers to give full-time work. 

“Full-time minimum wage right now is $27,300, that's well over the poverty line that’s at about $22,000,” he added.