The COVID-19 Pandemic Highlights the Need for a Living Wage: Policy Note
January 11, 2022
With the spread of the Omicron variant of COVID-19, news stories sounding the alarm about labor shortages are on the rise again. And, like previous waves, these stories focus almost exclusively on workers in precarious, low-wage jobs. These jobs serve large parts of the Canadian economy that are now recognized as “essential” in a post-pandemic society; jobs in the food supply and distribution chain, among others.
Precarious jobs tend to be characterized by part-time or casual work, low wages, and few benefits and job protections. This includes many jobs in service industries like retail, restaurants, and food services, among others.
The first year and a half of the pandemic, in addition to recognizing the essential nature of many precarious jobs, also saw advances for these workers in job protection and sick leave. Many provinces changed employment laws to ensure that all workers could take some form of unpaid sick leave and protected them from being fired for it. Some, like British Columbia, have gone further by granting at least some right to paid sick leave also for these workers.
Precarious jobs tend to be characterized by part-time or casual work.
The past two years of the pandemic have also highlighted many other issues and concerns for precarious workers, and the resulting labor shortages that have plagued service and food supply employers. weren’t just limited to periods of heavy COVID workload. More workers left these industries and fewer workers entered them. The reasons for this are well known: lack of job stability and security, few benefits, and most often at the top of the list, insufficient wages.
For example, someone working as a grocery clerk in Vancouver earning minimum wage would earn just over $600 a week, or $2,400 a month, working 40 hours a week. In light of the cost of rent, food and other essentials in Vancouver, that’s not enough to make ends meet each month. Staying home when sick would be a difficult choice to make if illness extended beyond the now mandatory five days of employer-paid sick leave in British Columbia (or if they fell ill more than once a year). And, the ability to cope with a pay gap if the workplace were closed would likely be insurmountable.
The pandemic has both illustrated and stimulated the demonstrated need for a living wage. A living wage is that which allows a household to “meet its basic needs”. That’s more than minimum wage. In Metro Vancouver, the calculated the living wage for 2021 is $20.52 while the minimum wage is $15.20. And the cost of many essential goods has been rising steadily since the calculation was made last year, in part due to the pandemic and its associated consequences. In 2022, for example, the cost of gasoline and basic foodstuffs like milk is predicted rise well above historical inflation averages.
Many precarious jobs are typically paid at or near minimum wage with no benefits. However, for employers facing severe labor shortages, a living wage can be an attractive incentive for workers to enter and stay in these industries.
The pandemic has both illustrated and stimulated the demonstrated need for a living wage.
Since the start of the pandemic, some employers in food services, in particular, have taken a step in this direction, offering above-minimum wages and other benefits. Others long ago took an even bigger step by becoming a “living wage employerin British Columbia. And in unionized workplaces, achieving decent pay and working conditions, beyond the legal minimum, is a matter of collective action and rights. In fact, since the start of the COVID-19 pandemic, more people working in precarious jobs and underrepresented industries in British Columbia, such as retail, coffees and food servicesbegan to unionize in order to increase their wages and working conditions.
The recognition that many precarious jobs, especially those in food supply and distribution chains, are essential to the functioning of our economy and society should also be a top priority for employers and policy makers. The shift from a minimum wage to a living wage by individual employers is a good start and can help stave off the prospect of business closure amid growing labor shortages. Legislative changes to move from a minimum wage model to a living wage model under labor law would help ensure that all workers can enjoy some measure of long-term economic security.
Topics: COVID-19, Employment and work, Poverty, inequalities and well-being