Pandemic squeezing younger generation

Generation Squeeze’s Paul Kershaw wants Canada’s tax systems shifted to take more account of property value and other wealth, arguing that this is one way to make life more affordable for younger Canadians.

Kershaw admits it will be a tough sell to those being asked to contribute more, but argues “generational inequity” and the solidarity of the moment make it both necessary and possible.

Young people are again bracing to take the hardest hit from new public health restrictions shutting down or restricting the service work they often do in the Toronto area and Ottawa, developments that expose the age group's specific economic vulnerability as the regions grapple with rising COVID-19 cases.

“They're unable to pay their rents or their mortgages if they got into homeownership,” said Kershaw, who heads the advocacy group for younger people, calling for more affordable housing and child care.

“We really need to think through during the pandemic how ... we adapt to the insecurity that comes disproportionately to renters,” he said, pointing out that eviction halts in some provinces only postpone missing rent payments and that hurts more than interrupted mortgages.

Advocates have warned that Toronto renters are facing a “bloodbath” of evictions in the aftermath of the pandemic.

“I think we really need to be worried about that dynamic going forward,” Kershaw said.

Workers 25 and younger were already struggling more than older Canadians to regain jobs lost since the public health crisis first spiked the economy in March. That underscores the degree to which socio-economic risk has shifted to younger Canadians over recent decades, Kershaw said.

When his mother was a young woman, seniors were particularly vulnerable economically, Kershaw said, with the highest rates of low income and poverty in the country. The older generations who made up the workforce in the decades since the Second World War have gotten increasingly more comfortable as stock market returns mostly rise and bond-backed pension funds guarantee certain levels of income.

Meanwhile, younger people were already struggling to juggle rising debts and costs, along with stagnant incomes and the pandemic complicated matters even further.

Now their jobs — in retail, hospitality and other service-based industries — are more likely to put them at risk of infection or will dry up when tighter restrictions are imposed, as they were in Ontario as of midnight Saturday.

“The pandemic has us fighting on two fronts trying to stop the spread of a virus that requires physical distancing,” said Kershaw, who is also the director of the master of public health program at the University of British Columbia.

“The virus is disproportionately harming our aging loved ones, (while) the physical distancing is in really important ways undermining the socio-economic determinants of health disproportionately for younger people,” Kershaw said.

That means COVID-19's effects on younger people are harder to pinpoint. While they can and do get seriously ill from the virus, more common challenges include increased stress and anxiety, reduced access to school and other social settings, lost income and more insecurity related to finances and housing.

“They're at their career stages where they’re disproportionately doing service work, and it's precisely those kinds of things that we are needing to close down when we think physical distancing is essential for stopping the spread of the virus.”

Housing at epicentre of inequity

The latest Statistics Canada job numbers, released on Friday, showed that the pandemic, much like the 2008 economic recession that has stunted earnings for recent graduates ever since, has been “particularly hard on young adults trying to get a foothold in the economy,” Kershaw said.

Kershaw does not endorse a universal livable income. Gen Squeeze instead focuses mostly on the high costs of housing and child care, stagnant earnings and mounting debts (including public debts like climate change), which it says are creating “generational inequity.”

He says housing is “at the epicentre of generational tensions” in Canada.

Increases in average home prices have outpaced earnings growth for young people, he said, forcing them to either take on too much debt to sustain a mortgage or keeping them tenants for longer, especially in urban areas.

The rising valuations also increase the net worth of those who owned that property earlier during the meteoric rise in prices in recent years, especially in and around Vancouver and Toronto.

Kershaw said he was somewhat hopeful in the prospect of progress being made in tackling these challenges, noting that people may have regained some of the faith society had in governments emerging from the Second World War.

“We have seen this dramatic response by governments of all political stripes intervening in our economies and in our lives to address a significant threat,” he said.

“Something might be changing in this moment,” he added. “There’s greater attention to the power imbalances that are existing in society and who's doing really important work for us.”

Morgan Sharp / Local Journalism Initiative / Canada’s National Observer