Can Canada 'restart' its economy when the ones earning the least face the highest risk?

The reopening of the Canadian economy has barely begun to begin, but Conservative Leader Andrew Scheer is already convinced that the Liberal government is failing at it.

"At a time when our economy needs stimulus, Justin Trudeau has given it a tranquilizer," Scheer said Monday.

Scheer's source of concern is the Canadian Emergency Response Benefit, which Conservatives fear will now act as a disincentive to work and a drag on the economic recovery. The program should be amended so that it "always pays more to work," Scheer said during Parliament's virtual sitting on Tuesday.

But putting the country back to work is going to involve much larger questions than whether the CERB has been properly calibrated.

The Conservatives' worry about the potential downside of government assistance is at least ideologically consistent. They also may be responding to scattered, but real, complaints from businesses.

But Scheer's use of words like "stimulus" and "tranquilizer" misconstrues the CERB's purpose.

Scheer calls for 'gradual type of reduction' for CERB

5 years ago

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Conservative Leader Andrew Scheer says that a gradual reduction of the emergency benefit would encourage more Canadians to get back to work.

The CERB was not intended primarily as stimulus — because there isn't much of an economy to stimulate at the moment. For the sake of minimizing the spread of COVID-19, huge parts of the Canadian economy were purposefully sedated two months ago. The emergency relief benefit — which pays $2,000 per month for up to four months — was a quick measure to assist those individuals who couldn't do their jobs because of the pandemic.

If anything, the program was meant to make it easier for the economy to shut down.

The argument that it might act as a "tranquilizer" going forward is based, in part, on the fact that an individual can only earn up to $1,000 per month while remaining eligible to receive the CERB.

Some sort of adjustment that allows an individual to earn more than $1,000 while still receiving some of the CERB (as analysts with the CD Howe Institute proposed in April and the Conservatives have since called for) might be one solution.

Worrying about the wrong thing

When asked about it by Scheer and journalists, Prime Minister Justin Trudeau's response has been that the government eventually will have to start winding down emergency measures — but that people still need help in the meantime.

The true impact of the CERB on employment isn't clear yet. But CERB's design hardly seems like the only issue — or even most important one — that should be on the minds of governments as the rest of us prepare to take our first tentative steps outside the current lockdown.

If people are going to be asked to return to work, the thing we should be worrying about first is whether those workplaces are safe — or as safe as possible.

Collectively, we might decide that reopening the economy with some risk is preferable to waiting until the risk can be completely eliminated. But minimizing that risk is still the responsibility of governments and employers.

Already, there have been situations that should give everyone pause — the outbreak among employees of the Cargill meat-processing facility in Alberta and the spread of the virus among foreign workers at a farm in Ontario.

No one is likely to forgive governments or employers for exposing people to risks that seem reckless or avoidable. 

If people feel they can go to work without great risk to their health, they'll also have one less reason to stick with the CERB.

"Few people are going to trade the longer-term security of a job for a temporary benefit that could expire before the summer is over," said Sunil Johal, a fellow with the Public Policy Forum and Brookfield Institute. "The huge caveat here is that people must feel safe returning to work, and that may not be the case in all types of workplaces right now."

The other significant barrier to returning to work might be a lack of child care. As long as schools and daycares are closed or unable to operate safely, someone will have to take care of the kids — and that could make it difficult, even impossible, for many people to return to work.

Will the people taking risks be those without options?

Some have suggested that parents will still have the option to keep their kids home once schools reopen, if they feel it isn't safe to send them there. But that could be an option available only to families that can afford to have one partner stay home. In the absence of financial support, many parents and caregivers might have to send their children to school so that they can earn a wage.

And there are larger questions here about who we're asking to take on additional risk, whether we'll be able to tell ourselves that those risks were absolutely necessary — and how well we're compensating the people whose jobs leave them more exposed to the virus.

COVID-19 already exposed inequalities in working and living conditions as it spread among the poorest and the least cared-for among us. Reopening could drive the wedge between the haves and have-nots even deeper — particularly if it's mainly low-income workers being asked to perform the tasks that involve the most direct interaction with other people.

If it's 'essential' work, shouldn't it pay better?

One recent analysis of the CERB noted its "relative generosity" when compared with the minimum wage in Quebec and suggested it might discourage people from returning to work. But such a comparison might also highlight how little some people will now be paid to return to jobs that come with significant new risks.

In Quebec, workers like cashiers, grocery clerks and delivery people were given a salary increase a month ago to ensure that no one would do the work for less than $2,000 — even if some will earn just $88 more than that.

Some health care and social workers in Ontario also have received a boost, while Trudeau has offered to work with the provinces to increase the pay of "essential" workers in hospitals and long-term care centres who earn less than $2,500 per month. But all low-wage earners being asked to work with or around other people might be able to make the case that their compensation should reflect the new risk they face daily.

If Scheer believes that it should always pay more to work, he presumably would have to support actions to ensure that all workers are earning comfortably more than $2,000 per month.

The transition from shutdown to a new normal of living and working with COVID-19 is necessarily going to require changes and adjustments. But beyond figuring out how to calibrate the CERB so that it does not unduly discourage work, there's the greater challenge of ensuring that the reopening does not worsen or reinforce the social and economic inequalities that existed before this pandemic arrived.

The act of reopening is not going to be as easy as telling people to go back to work.