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Cost of living stats indicate tough road ahead for Vancouver families

Newly released data on the cost of living is not good news for Vancouver families who are already struggling in one of the most expensive cities in the world.
Parents in a two-parent household with two children need to earn $38,056 a year each in order to mak
Parents in a two-parent household with two children need to earn $38,056 a year each in order to make a living wage in Metro Vancouver, according to a recently released report. Photo Dan Toulgoet

Newly released data on the cost of living is not good news for Vancouver families who are already struggling in one of the most expensive cities in the world.

According to a report published April 25 by the Canadian Centre for Policy Alternatives, the Living Wage for Families Campaign and First Call: B.C. Child and Youth Advocacy Coalition, each parent in a two-parent household with two children needs to earn $38,056 a year.

This means both parents must earn at least $20.91 per hour to cover basic expenses, after deductions such as government taxes and subsidies are taken into account.

This marks an increase of 29 cents from last year’s calculation of $20.62. It also marks a 25 per cent increase from 2008 when the first living wage study was conducted.

The formula used by the authors of the report takes a variety of factors into consideration when developing a final number for the year. It accounts for two working parents with one or more jobs each, and two children with needs including child care and school expenses. It does not take into account anything apart from the basic necessities of living, such as credit card or student loan debt, retirement savings, or emergency funds in case of an illness or other unexpected events. 

Not surprisingly, the report points to housing as the main culprit behind the rising cost of living.

The median rent cost for a typical three-bedroom home in Metro Vancouver officially rose to $1,600 per month in 2017, up $100 from the previous years’ mark and representing an increase of 6.7 per cent, far outpacing the province’s allowable rent increase of 3.7 per cent. In the city of Vancouver, this number is considerably higher.

Housing is not the only area where things are becoming more expensive, according to the report. Utilities, transportation and food costs all went up last year, putting further strain on Vancouver families.

One notable improvement was child care costs, where the new Child Care Fee Reduction Initiative saw annual costs in this area reduced by $425 from 2016.

According to Iglika Ivanova, co-author of the report and a senior economist and public interest researcher at the Canadian Centre for Policy Alternatives, these advances in child care will be rendered meaningless if the housing issue is not addressed.

“The message from this living wage report is that if the government doesn’t get serious about affordable housing, all the other policies are not going to be enough,” Ivanova said. “Without that, all the savings for families will be just offsetting rent increases, and there will be no improvement. They’ll still be living paycheque to paycheque, and have nothing left over.”

Deanna Ogle, a campaign organizer for the Living Wage for Families Campaign, agrees, but says in the meantime there are measures governments can take to alleviate the burden on families.

“We need to have policies based around rent. We need to tie the maximum rent increases to the unit, not the tenant,” explained Ogle, addressing the widespread trend of substantial rent increases when a landlord obtains a new tenancy.

“We need to protect the existing affordable housing stock that’s there,” Ogle added. “[This means] making sure that that’s not being knocked down to build condos.”

The cost of the living wage cannot be measured in dollars alone however, says Ogle. Much of the strain is unseen, and manifests in the form of stress and health related issues for families hovering under the living wage line.

Ogle’s work puts her in direct contact with these families. “That kind of anxiety that people feel at the end of the month where they know they’re going to have to balance bills,” Ogle said. “You feel this weight on your chest, you know that that’s an impossible balance.”

One of the results of such a high cost of living is that parents often need to take on a second job to make ends meet, according to the report. The current minimum wage in B.C. is $11.35 per hour, far below the $20.91 outlined in the report.

In addition to the physical toll added hours of a second job entail, it also affects development time between parents and children, says Ogle.

“If your parent is working two jobs, they’re coming home tired. They’re not doing things like reading you a book, doing homework, or asking how your day at school was,” Ogle said. “Although a parent wants to be engaged and wants to be involved, there are stressors that come to the family when we have those incredible time burdens on individuals.”

There are some encouraging signs on the horizon, according to the report. The B.C. Affordable Child Care Benefits plan outlined in the provincial budget in February expands families eligible for increased child care benefits to a total combined income of $110,000. The federal Canada Child Care Benefit will also be reworked this year to account for inflation.

In addition, many businesses and jurisdictions are taking on the task of becoming “living wage employers.” This means their employees’ wages reflect the current living wage index. There are now 77 such employers in Metro Vancouver, in addition to the City of Vancouver adopting a similar pledge.

Ivanova believes this is a key step in addressing the problem. “Local government should serve as an example, especially as local governments are responsible for providing services in their community,” she said. “They should make sure that they don’t contribute to poverty through their own low pay.”