Worsening Ontario income gap mirrored on Hamilton streets

'We have 30,000 people in Hamilton who work every day and who simply don't earn enough to escape poverty.'
Sara Mayo, at the SPRC. (Supplied.)

The income gap between rich and poor in Ontario is at an "all-time high," says a report released Wednesday, with the province’s poor and middle classes working more hours with negligible income gains while the richest 10 per cent experience huge income increases despite working fewer hours.

The report, entitled Falling Behind, is the joint effort of more than 90 labour and community groups that call themselves the Ontario Common Front (www.weareontario.ca).

Some of the report's more troubling findings:

  • 1.7 million Ontarians live in poverty (1 in 7 kids)
  • 600,000 family incomes stalled or failing
  • 30,000 + are waiting for hospital and long term care beds
  • Ontario spends 44% less on affordable housing than other provinces
  • Workers earn 19% less, with women being at a particular disadvantage, earning 29% less.

Mind the gap

The 48-page report suggests that while incomes stagnate among the poor and middle classes, those in the highest income brackets are enjoying unprecedented financial prosperity, with CEOs earning 250 times the average salary (up 25 times in a generation).

"Those parts of the middle class that have gained, have gained very, very little. Just a tiny $1,000, or so, over an entire generation. What's really happened is that the top 10 per cent have galloped away with the bounty of the last couple of decades of economic growth," the report's Natalie Mehra told CBC.ca.

In addition to the widening gap between rich and poor, the paper’s findings argue that recent choices in Ontario’s economic and social policies have resulted in a variety of negative effects, from increasing wait times for subsidized housing (the highest in the country) to reduced funding for health care (the least in the country).

"Ontario is falling behind the rest of Canada in terms of growing poverty, increasing inequality and flagging financial support for vital public services," writes Mehra.

Many Ontarians may be surprised to learn that the province spends less on all public programs and services than any other province in Canada.

This reduced investment is in part the result of the province’s tax policies, suggests the report, which have reduced Ontario’s provincial revenue, and therefore potential investment in social services and support programs, by $15 billion per year.

‘Hamilton a microcosm of Ontario’ 

In Hamilton, where the unemployment rate hovers around 6.8 per cent and approximately 18.1 percent of the population lives in poverty, the report’s findings resonate deeply.

"Hamilton is a microcosm of Ontario in many ways," says Sara Mayo, a social planner at the Social Planning and Research Council of Hamilton.

Hamiltonians have already identified poverty as the greatest issue facing the city, says Mary Long, President of the Hamilton and District Labour Council and part of the Ontario Common Front.

"In the last election the number one issue that Hamiltonian’s identified was addressing the poverty issue," she says.

Tom Cooper, director of the Hamilton Roundtable for Poverty Reduction, calls the report "comprehensive" and feels it’s sure to "open some eyes."

Cooper points out that Hamilton’s income gap, in some cases, is even more serious than in the rest of Ontario, however.

"In Ontario, there are one in seven children living in poverty. In Hamilton, unfortunately, that number is one in four," says Cooper.

"We have 28,000 kids growing up in low income households in this city and that’s pretty much enough to bring Ivor Wynne Stadium to capacity," he says.

Mayo says that while the report cites 36 per cent of food bank users in Ontario are children, in Hamilton the number is far greater, with children making up 46 per cent of food bank users.

Hamilton also has an alarming rate of poverty among recent immigrants, says Cooper, with nearly 50 percent living in poverty.

Poverty doesn’t 'happen by accident'

 The report outlines how policy changes have real effects on day-to-day lives both in Ontario and Hamilton, says Mayo.

"The worrying trends we see in this report didn’t happen by accident, and nor are they inevitable," she says. "They arise because of policy decisions and these can be changed so that they focus more on investing in people and quality of life."

Mayo is in agreement with the report’s conclusion that in order to reverse the trend in income disparity the provincial government needs to invest in social services and programs.

"It’s not surprising that Scandinavian countries who have invest more in programs that increase of quality of life, such as affordable housing and education, we see the smallest gaps in income inequality," says Mayo. "Closer to home, we see the example in Quebec where investments in childcare increased the GDP more than the cost of delivering the program."

For Cooper, the findings call for "serious reform of social assistance" and an increase in the living wage. Approximately 60,000 people rely on social assistance in Hamilton, says Cooper, and they’re "are simply not getting enough income support to get out of poverty," he says.

Citing the report’s finding that more and more people are working for less, Cooper calls for an increase in the living wage.

"We have another 30,000 people in Hamilton who work every day and who simply don’t earn enough to escape poverty," says Cooper.

The report also draws attention to the issues of employment and education, which Long also feels is pertinent in the city.  Long say many young people have been sold a false bill of goods when it comes to higher education—the OCF report points out that Ontario has the highest undergraduate fees in Canada—and how it translates into jobs.

"I have a nephew who has a BA in arts and he’s working in a restaurant. For all that big story about ‘stay in school, get a higher education, the jobs will be yours’— they’re not there."