To: Canadians concerned about prosperity From: Don Wright Date: September 4, 2024 Re: Some Basic Living Standard Arithmetic for Governments
Governments often talk about “creating jobs,” but what they really do is choose some jobs at the expense of others. With their myriad spending, taxing and regulatory decisions, all governments try to direct job growth to different sectors – public or private, services or goods, resources or non-resources, and so on.
We all hope governments choose wisely.
It would help if they started paying more explicit attention to one factor: The impact of their decisions on Canadians’ standard of living.
A country’s standard of living is largely determined by the wages and net government revenue its tradeable goods and services sector can pay while remaining competitive against international competitors. If a company or sector is uncompetitive, it will have to either lower its wages, pay less tax or go out of business. These pressures on companies are never-ending. They determine both the wages a sector can afford to pay, and, through the interconnectedness of labour markets, average wages across the economy.
Some industries are so productive they can pay relatively high wages and significant taxes and yet remain competitive.
Industries that aren’t as productive can only pay lower wages and less tax.
Governments whose policies have the effect of moving labour from one sector to another had better pay attention to such facts.
Canadians may not like it but many of the country’s best-paying and most tax-rich jobs are found in natural resources. I was head of British Columbia’s public service. For most of B.C.’s history the province’s economic base has been dominated by natural resource industries – forestry, mining, oil and gas, agriculture and fishing. For a variety of reasons, these industries face strong political headwinds. Many groups press to constrain them and diversify away from them. The alternatives proposed include technology, film and tourism.
A few years ago, I asked officials in the province’s finance ministry to assess the relative performance of these different industries along the two key dimensions of average wages and net government revenue. In 2019-20 B.C. spent approximately $11,700 per citizen. Half the population was employed that year. So, to “break even” (i.e., have a balanced budget), the province had to collect $23,400 per employed person. If you look at things this way, each industry’s “profit” or “loss” is simply its revenue per employee less $23,400.
No such calculation will be exact, of course.
Several assumptions have to be made to get to an average “profit” or “loss” per employee. But, with that caveat, the numbers the officials brought back were telling. The industry with the biggest return to the province was oil and gas, at $35,500 per employee. Forestry was next, at $32,900. Then mining, at $14,900, and technology, though only at $900.
By this measure of profit and loss, however, film was a money loser, at -$13,400, and so was tourism, at -$6,900.
The negative numbers for the film industry reflect the very significant subsidies that B.C. (like many other provinces) provides to this sector. The negative number for the tourism sector primarily reflects low average wages per employee, which translate into relatively low personal income tax, sales tax and other taxes paid by employees.
These “profit or loss” numbers are not in any way a judgment about workers in these sectors. People find the best employment available to them in the labour market. Relative demands in that market are determined by many factors, none of which workers control. That said, if governments consciously move resources from the “profit” industries to the “loss” industries, they had better be aware of the consequences for wages, taxes and the overall standard of living.
The numbers I’ve cited were for a single year in British Columbia. The same analysis for other provinces or for Canada as a whole would likely produce different numbers – though I’d be surprised if the overall pattern were much different. Voters will draw their own conclusions about the impact on British Columbians’ standard of living from constraining the resource industries and promoting other industries instead.
Unfortunately, this type of analysis is rarely done when Canadian governments make decisions about what types of jobs they want to give preference to through their taxation, spending and regulatory decisions. They should do more of it. Ultimately, if [they] care about Canadians’ standard of living, governments need to start paying attention to the basic arithmetic of that standard of living.
Don Wright, senior fellow at the C.D. Howe Institute and senior counsel at Global Public Affairs, previously served as deputy minister to B.C.’s premier, cabinet secretary and head of the public service.
On her fridge door, along with numerous family pictures, Danielle Brandt has a handwritten quote by Dr. John Trainer: “Children are not a distraction from more important work. They are the most important work.”
A proud Calgary mother of three boys (Aiden, 10, Theodore, 4, and Silas, 2), Mrs. Brandt is a homemaker. Her husband, Adam Brandt, is the breadwinner. At the core of their parenting philosophy is the belief that strong families make strong societies, Mrs. Brandt says.
She was a music teacher before becoming a stay-at-home mom, but when she returned to work shortly after giving birth to her first child, she says she realized she wanted to be fully involved in raising her children.
“The idea that your identity is found at home with your family and not out in the world with your peers, and that your parents and your family are what matters first … that’s the reason I wanted to be home with my children.”
While Mrs. Brandt persists in adhering to her traditional role in the family, there is declining interest among young Canadian women to pursue the same path.
Canadians are “increasingly less likely” to form families, and if they do, they are choosing to have fewer children, if any at all, according to a May 2024 report jointly published by the Macdonald-Laurier Institute (MLI) and the Centre for the Study of Living Standards.
The same report, based on evidence from existing data and literature, found that traditional families enjoy more prosperity and better health.
Adults who are in a couple tend to earn more money per person than singles of the same age and, if married, they tend to live longer, have healthier lifestyles, and are less stressed. Similarly, children benefit from being raised by their two biological parents in a stable marriage, appearing to have a higher standard of living and educational attainment, and being less likely to engage in risky behaviour, the report found.
But a significant fraction of Canadian children will see their families break up by the time they are 14, and more than a quarter live in one-parent families, the report said. The author, Tim Sargent, deputy executive director of the Centre for the Study of Living Standards, concluded that the rates of family dissolution in Canada are higher than those in the United States and the UK, culturally comparable countries.
Janice Fiamengo, a retired University of Ottawa English professor who now gives talks on the role of women in society, says the downward trends in family formation are largely due to how women’s priorities are being redefined in Canada.
“Their primary goal in life is to be independent, to have a career, and to regard marriage and childbearing as secondary, if not undesirable in general,” Ms. Fiamengo told The Epoch Times, describing the trends and messages aimed at young women today.
Trends Among Canadian Women
Women are now taking longer to complete their higher education. From 2000–2022, the participation in education of women aged 20 to 24 rose by 12 percent (to 51 percent), according to Statistics Canada.
Only 37 percent of men in the same age range participated in education in 2022, and that rate grew by just four percentage points since 2000. Similar trends are seen among men and women aged 25 to 29.
Women’s participation in the labour market has also increased dramatically in recent decades, with fewer and fewer women choosing to be stay-at-home moms.
Employment among women aged 25 to 54 has almost doubled from 40 percent in 1976 to about 80 percent as of May 2024, according to Statistics Canada. Employment rates for women in general remain higher than they were prior to the pandemic in 2017 and 2019.
In addition, more women aged 25 to 34 now delay living with their partner. The proportion of those who live with their parents increased by 3.3 percentage points, from 12.8 percent in 2011 to 16.1 percent in 2021.
Marriage rates are on the decline while divorce rates are increasing, and women are waiting until later to have children.
At the same time, Canada’s fertility rate has been declining persistently for the past 15 years, with the national rate hitting an all-time low in 2022 at 1.3 children per woman.
A study by the think tank Cardus found that the top factors that diminish a woman’s desire to be a mother are wanting to grow as a person, wanting to save money, focusing on a career, and believing that kids require intense care.
“Any woman who decides that what she primarily wants to do is to marry and to have children, that woman is seen as having failed, having let down other women, and having failed herself,” says Ms. Fiamengo.
She says the prevalence of feminism in Canada has played a role in shaping these views.
Changing Views on Traditional Family Roles
It wasn’t until the second-wave feminism of the 1980s that an idea with communist roots took hold—the dissolution of the traditional family structure, Ms. Fiamengo says.
Feminism takes many forms and contains different ideas—in the 19th century, it was about women’s suffrage. The idea that the traditional family is at odds with gender equality and women’s fulfilment has its origins in communist ideology.
In his 1884 book titled “The Origin of the Family, Private Property and the State,” Friedrich Engels, based on notes by Karl Marx, made the first allusion to the monogamous family as “the world historical defeat of the female sex,” in which the woman was reduced to servitude and turned into an instrument for the production of children.
He thus advocated for the liberation of the wife, the abolishment of the family, and for the care and education of the children to become a public affair.
“[Engels] explicitly makes that connection, that the man—the patriarch—is the capitalist oppressor. The woman is in the situation of being the oppressed worker or the sex slave in the family,” says Ms. Fiamengo.
“He saw no distinction between prostitution, in which a woman is bought by a man to have her body used for the man’s pleasure, and the situation of a woman in a marriage.”
Betty Friedan’s 1963 book “The Feminine Mystique,” a precursor of feminism as a struggle between genders, urged women to break free from the domestic sphere and find their own identity outside the home. Friedan promulgated that fulfillment could not be found through marriage and motherhood alone.
Ms. Fiamengo says feminism’s lack of encouragement for women to start a family makes them miss out on what she thinks is one of the greatest joys of human life—childbearing.
“The fact that our government doesn’t encourage marriage … or encourage couples to stay together for the good of their children, is doing a terrible disservice to the future generations,” she says.
Peter Jon Mitchell, program director for Cardus Family, says the prevalent view of marriage in Canada is that “it’s nice, but unnecessary.”
“We don’t really talk a lot about marriage and the benefits of marriage in our culture.” Mr. Mitchell also that, compared to the United States, where the two-parent privilege—the fact that children fare better in two-parent rather than single-parent households—and the benefits of marriage are part of the public discourse, Canada lags behind.
The May MLI report cites some studies showing that children in two-parent households fare better. One published by the National Library of Medicine in 2014 found such children do better physically, emotionally, and academically.
Likewise, in a 2015 research paper, David Ribar, honorary professor at the University of Melbourne, found that children who grow up with married parents enjoy more economic and family stability. Mr. Ribar argues that the benefits of marriage for children’s wellbeing are hard to replicate through policy interventions other than those that support marriage itself.
Consequences of Putting Family Role Second
Sociologist Brigitte Berger noted in her book “The Emerging Role of Women” that work is important for both sexes. Yet liberation through work means different things to different people.
To the working-class women and the poor, for whom work is a necessity, liberation means freedom from financial burden and the freedom to devote time to things that matter outside of work, such as family, community, and hobbies. Among women for whom work is not a necessity, modern thinking has led them to find identity and liberation through paid labour.
According to a 2021 survey by the Canadian Women’s Foundation, 28 percent of mothers reported difficulty keeping up with work demands, and half of mothers felt exhausted trying to balance work and childcare responsibilities.
“I think most mothers would prefer to be part-time,” says Mrs. Brandt. “They don’t actually want to leave their kids 100 percent of the time with someone else.”
She says the widespread notion that women can do it all is not realistic and can lead many to burnout. “I can’t fully parent my children well and fully do another job [outside the home], at least not the way I want to,” she says. “Something has to give; there’s not enough of me.”
Mrs. Brandt says she is not worried about her chances of returning to work at some stage.
“We live a long time nowadays. You can’t always have kids, you can’t always be with your kids when they’re young or get that time back when they’re young,” she adds. “But you could do a career later, and that’s the amazing thing about our culture, too.”
Last year, a study by the think tank Cardus found that half of Canadian women are not having as many children as they would like, and that this group reported lower life satisfaction than women who achieved their fertility goals.
Cardus senior fellow Lyman Stone noted low fertility rates are not because women want few kids, but the timeline most of them follow for school, work, self-development, and marriage leaves too few economically stable years to achieve the families they want.
One of the most striking findings of the May MLI report is that Canada has seen a marked deterioration in the mental health of young women over the last decade.
More than three-quarters of women aged 15 to 30 reported excellent or very good mental health between 2009 and 2010. Throughout the following nine years, that figure dropped 22.5 percentage points, to 54 percent. For women aged 31 to 46, mental well-being also declined, but only by 10.1 percentage points.
Motherhood and Women’s Happiness
A Cardus 2023 study concluded that women’s happiness and fertility are linked. The think tank surveyed 2,700 women aged 18 to 44 about family and fertility, and found that mothers are happier than non-mothers everywhere (except when they are under 25 or living in poverty).
“The role of the mother really is to nurture and to develop children,” says Mrs. Brandt. “My husband is a wonderful nurturer, he’s fantastic at it, but my boys, even the ones that have the closest relationship with him, they still need mom … I’m still the safe place.
“I am not saying that men can’t do it, but sometimes women are built for it, and there’s nothing wrong with that.”
She draws inspiration from her mother, who was also a teacher turned homemaker. Mrs. Brandt says her mother was always available for her and her three siblings, and would show up at their most important moments, including sporting events, school functions or field trips. “We felt like we were the priority because we were,” she says.
But being a stay-at-home mom is also demanding, Mrs. Brandt adds. Although it’s rewarding, she says the challenge is that there is no time off. “But at the end of the day, when I look at my children and see them peacefully sleeping, [I think to myself] ‘That’s it, that’s what this is about,’” she says. “They are the future generation. I want to pour into that, and there is no more valuable work than that.” For the Silo, Carolina Avendano.
Featured image- Danielle and Adam Brandt with their sons Silas (L), Aiden (C), and Theodore at their home in Calgary on June 1, 2024. (Carolina Avendano/The Epoch Times)
An increasing number of Canadians can’t afford a house or find a decent-paying job. Some can’t find a date or are fed up with the bitter politics, while others are in search of adventure, are sick of the cold winters, or simply miss the feeling of ‘being home’.
The solution they seek? Leave Canada.
The rising cost of living, record-high immigration, a stagnating economy, and political tensions are prompting rising numbers of Canadians—both native and naturalized—to leave the country.
Canada is increasingly becoming a country of emigrants, as well as a country of immigrants, experts say.
“We’re definitely seeing a lot more interest from people wanting to leave Canada,” Michael Rosmer, founder of Offshore Citizen, a Dubai-based company that offers relocation services to people around the globe. “This is disproportionate to their numbers overall.”
He said many of his clients are motivated by the increasing ability to work from anywhere, plus political tensions within Canada accompanied by a feeling of lost freedoms. Also a factor is the rising standard of living of many countries that were once far below Canada in terms of health care, education, and other services.
While Canada was once considered among the best places in the world to live, “it’s like the world has flipped,” Mr. Rosmer said. “The alternatives have gotten meaningfully better. Today if you go to Kuala Lumpur you’re going to find that it is arguably better than any Canadian city.”
Some 94,576 people emigrated from Canada from mid-2022 to mid-2023, an increase of 1.8 percent from 92,876 in the year-earlier period, and up sharply from 66,627 in the period from mid-2020 to mid-2021, which fell during the pandemic lockdowns, according to data from Statistics Canada.
A study released last year by the immigration advocacy group Institute for Canadian Citizenship (ICC) showed immigrants are also increasingly reluctant to stay, with the proportion who stick around to obtain full citizenship within 10 years of receiving permanent resident status plunging to 45.7 percent in 2021 from 60 percent in 2016 and 75.1 percent in 2001.
Cameron MacDonald, a 29-year-old from the Niagara Falls region of Ontario who left Canada in March for Japan, cited the high cost of living as the main reason for his move, which uprooted him from friends, family, and a job as an anti-fraud analyst with a major Canadian bank. He is now studying Japanese and looking for a job with a foreign firm, while living in Tokyo, which has a population density of 6,363 people per square kilometre compared to Toronto’s 4,427.8 per square kilometre.
“Here in Tokyo, the world’s biggest city, I pay $650 a month for a room that I would have had to pay $2,000 for in Toronto.” I had a routine and a cushy bank job and I was even living with my dad after a while but I still couldn’t get ahead financially.”
He said the high cost of housing in Toronto means that all of his friends of a similar age in Canada are still living with their parents and, as many of them consider starting families, they are watching his move with the thought of moving abroad themselves.
“My five-year goal includes a wife, a house, and kids and there’s no way I could afford that in Canada,” Mr. MacDonald said. “You can’t really date and find a wife when you’re living with your dad.”
“In Japan, I wake up with a smile on my face every day,” he said. “It’s like I have found a new passion—I can start a family here.
High Immigration
Like many people, Mr. MacDonald blames Canada’s rapid pace of immigration for driving up the cost of living and forcing him to move abroad.
As of Oct. 1, 2023, Canada’s population was estimated at 40,528,396, a record increase of 430,635 people in the previous three months alone, according to Statistics Canada. That growth rate, at 1.1 percent in a quarter, was the highest since 1957, amid Canada’s baby boom plus an immigration surge fueled by a refugee crisis in Hungary at the time.
In just the first nine months of last year, Canada’s population grew by 1,030,378 people, more than any other year dating back to confederation in 1867, the statistics show. And 96 percent of that growth came from immigration. Overall, the population grew 30 percent since it reached the 30 million figure in 1997.
Canada’s Plan to Welcome 500000 Immigrants by 2025. ascenda.com
Indeed, rapid population growth has outstripped economic growth in recent years, lowering the standard of living in Canada as more people compete for less housing space and place greater strains on health care, education, and other services, according to a study published in May by the Fraser Institute. The study shows Canada’s real gross domestic product per person dropped 3 percent between April 2019 and the end of last year, from $59,905 to $58,111. The only steeper drops in the 40 years covered by the study were from 1989 to 1994, with a decline of 5.3 percent, and the financial crisis of 2008 to 2009, when it dropped 5.2 percent.
Another factor propelling emigration may be the aging of the baby boomer generation. As more Canadians reach retirement age, emigration to the United States, particularly to sunny states such as Florida, is accelerating.
A study by Statistics Canada also shows that high immigration tends to push up emigration because some immigrants move back to their home country. The study showed that 15 percent of the people who immigrated to Canada between 1982 and 2017 returned within 20 years of admission.
Whatever the root cause, the interest in leaving Canada has caught the attention of the global industry of specialists offering services to wealthier emigrants around the world.
Videos created by people seeking to offer second-passport services and other relocation help are growing in popularity. “Nine Steps to Escape Canada,” a YouTube video watched 362,000 times, “5 Reasons to Leave Canada in 2024,“ watched by 261,000 and ”Canada is Dying!,” with 531,000 viewers are some of the most popular.
Jay Suresh, the founder of Goodlife Investor, which offers emigration services to people around the world looking to obtain second passports, foreign tax advantages, and other benefits, says the number of Canadians looking for dual citizenship jumped after the Canadian government banned unvaccinated people from flying or travelling by train in late 2021 until the summer of 2022.
“This was an eye-opener for a lot of people. They got frustrated with just that one citizenship and they wanted multiple citizenships,” he said in a video promoting his company. Now, he says, Canadians are nearly tied with U.S. citizens in searches for second passports, even though the United States has 10 times Canada’s population. For the Silo, Adam Brown.
Featured image: People line up to go through security screening at Pearson International Airport in Toronto on Aug. 5, 2022. (The Canadian Press/Nathan Denette)
September 15, 2022 – Taxpayers and citizens need greater fiscal transparency from Canada’s federal, provincial and territorial governments, says the latest report from the C.D. Howe Institute.
In “The Right to Know: Grading the Fiscal Transparency of Canada’s Senior Governments, 2022,” William B.P. Robson and Nicholas Dahir graded these governments’ budgets, estimates and financial statements on how well they let legislators and voters understand their fiscal plans and hold them to account for fulfilling them. The grades range from A to D. While some of the governments present helpful and timely budgets and financial statements, others fall badly short.
The authors underline that budgets, estimates and financial statements must let interested but non-expert users find and understand and act on key information.
“Taxpayers’ and citizens’ ability to monitor, influence and react to how legislators and officials manage public funds is fundamental to representative government,” say Robson and Dahir. “We need to check that legislators and government officials are acting in the interest of the people they represent, and we need to respond if we conclude that they are acting negligently or in their own interest. Financial reports are key tools for monitoring governments’ performance of their fiduciary duties.”
While much of the financial information presented to legislators and the public by Canada’s governments has improved over time, the assigned grades reveal significant shortfalls. This year’s report card covers year-end financial statements for fiscal year 2020/21 and budgets and estimates for 2021/22. The results were as follows:
Manitoba, British Colombia and the Northwest Territories trailed the the class with grades of D;
The federal government got a D+ – which was actually an improvement from an F last year, when it failed to produce a budget;
Newfoundland and Labrador also got a D+;
Nova Scotia scored a C and Prince Edward Island scored a C+;
Quebec scored a B- and Ontario scored a B;
Nunavut, Saskatchewan, and New Brunswick each scored B+;
Alberta and Yukon topped the class with grades of A and A- respectively.
These governments tax, spend and borrow hundreds of billions of dollars, and the fiscal impact of the COVID-19 pandemic will make their financial position all the more important in the future. The authors conclude: “This annual report card hopes to encourage further progress and limit backsliding. Canadians can get more transparent financial reporting and better fiscal accountability from their governments, if they demand it.” For the Silo, Lauren Malyk.
For more than 60 years, the C.D. Howe Institute has researched and published on policy challenges and potential solutions aimed at improving the performance of Canada’s economy and raising Canadians’ living standards.