COVID,  Income Security,  Labour Standards,  Research

Income Security and Workers’ Power: Work, Wages, and Basic Income after COVID

The success of the CERB and complementary policies in helping Canadian households through the COVID pandemic confirmed the effectiveness and feasibility of much stronger income security. The CERB was not designed to be a “basic income”, but its broad coverage, generally adequate benefit level ($500 per week), and effectiveness in preventing mass dislocation during the pandemic has spurred arguments for a permanent form of basic income. Thanks to the CERB, poverty actually fell in Canada despite the pandemic. That confirmed we could achieve permanent reductions in poverty with similar, permanent income supports.

Employers, however, complained loudly that the CERB undermined the “incentive to work” among current or prospective staff. Indeed, the relationship between income security for working-age people, and the power balances that shape the terms and conditions of paid work, is a long-standing tension in social policy. Employers prefer a situation as close to “work or starve” as possible: if workers have few alternatives to support themselves and their families, they face more compulsion to accept unfavourable or even dangerous conditions in paid work. On the other hand, if it is possible to live adequately without accepting paid employment, workers have more capacity to resist employer demands that are unfair or intolerable.

The positive impact of unconditional income benefits on the power relationships embedded in conventional employment relations constitutes an additional reason why more universal and accessible income security – if not a full basic income, then at least significant steps in that direction – would benefit large segments of the population. These benefits would flow not just to those who cannot work (for various reasons) and need income, but also to those who are working – but need more power to negotiate better terms and conditions of employment.

In this briefing paper, Centre for Future Work Director Jim Stanford considers the interactions between income support, power balances in employment relations, and the viability of basic income proposals. It argues that the complementarity between good income security and workers’ bargaining power creates a shared motivation for the trade union and basic income movements to cooperate.

Please see the full paper, Income Security and Workers’ Power: Work, Wages, and Basic Income after COVID.

Jim Stanford is Economist and Director of the Centre for Future Work. He divides his time between Sydney, Australia and Vancouver, Canada. Jim is one of Canada’s best-known economic commentators. He served for over 20 years as Economist and Director of Policy with Unifor, Canada’s largest private-sector trade union.