IAMAW Canada – Living Wages: Narrowing Wealth Inequality

ILO Reaches Agreement on Living Wages

The International Labour Organization, an agency of the United Nations with a mandate to promote decent work around the world by setting international labour standards, reached a milestone agreement on living wages.

Experts who studied living wages as a policy tool, agreed that living wages are essential for social and economic justice and equity. Living wages also play a role in reducing poverty and inequality, both of which are becoming social problems of our time. By some accounts the gap between the wealthiest and poorest Canadians is growing at record speed.  Research by StatsCan shows that the top 20% of earners in Canada held 68 % of the country’s net worth in the first quarter, compared with the bottom 40% holding 2.7 %. (LINK)

The ILO emphasized that living wages should be set by, “…strengthening social dialogue and collective bargaining and empowering wage-setting institutions. The document also recalls that, “the needs of workers and their families and economic factors are the two pillars of wage-setting processes”. This means that policymakers ought to develop policies that take into account hardships and daily realities of working people, as well as, economic factors. Despite calls on governments to address the needs of workers, many workers continue to struggle to meet their needs. Wages are endemically low compared to the cost of living, and many families are unable to afford healthy food, decent housing, medical care or schooling for their children.

In Canada alone, usage of food banks has grown at unprecedented levels, by 78% since March 2019. Food insecurity, defined by not having access to sufficient food, or food of adequate quality, is now being driven by inflation and the high cost of living. What has also changed among food bank users is that 20% have jobs, but don’t earn enough to make ends meet.

What Are Living Wages?

A living wage covers basic expenses and allows a worker to fully participate in their community. Living wages provide workers with a decent living, enable them to participate in their community and meet their needs without reliance on government assistance. Living Wage Canada tracks regional economic changes and adjusts regional living wages; for more information, you can visit this website https://www.livingwage.ca/

Minimum wages, on the other hand, prevent employers from paying workers any lower than the minimum. They are often set by legislation, making it illegal to pay workers below the minimum.

As making ends meet on a minimum wage is next to impossible for majority of Canadians, promotion of living wages at the international level is groundbreaking. The ILO’s support provides another policy tool for governments to use in addressing the alarming wealth gap.

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