Monday, November 7, 2022

Helping Workers Make Ends Meet

Families and individuals are having to make difficult and sometimes drastic choices to cut expenses

By Paul Wilson, Research Director

Many Canadian workers are struggling to make ends meet. Rising interest rates and soaring inflation, currently at 6.9 percent nationally, and the resulting increased cost of housing, groceries, gas, and utilities, is putting immense pressure on family budgets.

In response to these circumstances, families and individuals are having to make difficult and sometimes drastic choices to cut expenses. For example, a recent University of Saskatchewan survey found that 20 percent of Canadians are choosing to skip a meal each day to lower their food costs.

This is a sad and sobering finding, but it is not surprising. According to Statistics Canada, food costs increased by 9.7 percent between April 2021 and April 2022, and these prices are showing no sign of decreasing in the near future.

On the housing side, Canadians who need to renew their mortgage are faced with a substantial rate increase. Conventional five year fixed mortgage rates rose from 3.2 percent on August 31, 2021, to 5.64 percent as of September 30, 2022.

Using these figures, monthly payments on a renewed $200,000 mortgage amortized over 25 years would increase from $967.13 to $1,237.13, an increase of $270 a month.

Experts have also noted that heavy debt loads, for the 70 percent of Canadian households that are carrying debt, are another source of financial stress. In the second quarter of 2022, Canadians owed $1.82 in debt for each dollar they made in a year. That is close to the all-time record of $1.85 set in 2021.

Amid all the economic challenges, uncertainly, and the doom and gloom that dominates our daily economic news reports, CLAC is working diligently to address the needs of workers in these tough times. Despite public-sector wage suppression legislation in some jurisdictions and economic headwinds for some private-sector employers, CLAC strives to secure good agreements at the bargaining table and ratification of these agreements by members.

Of course, the negative effects of economic forces that are beyond anyone’s control may be with us for some time. Nevertheless, whatever the economic or political circumstances, CLAC will continue to advocate for workers and seek just and fair compensation for the valuable and necessary work they do.

Helping Workers Make Ends Meet

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