Open Letter to Mayor Fontana on London "Jobs Summit"
August 19th, 2011 - 5:06pm
Dear Mayor Fontana:
I am sorry that I am not able to attend the meeting of August 12, 2011. I want you to know that I am very concerned about the employment challenges facing Londoners and want to work with my colleagues at all levels of government to ease the job crisis in London. My assistant Shawn Lewis will be present on Friday on my behalf.
I believe all three levels of government have an opportunity to initiate actions that would benefit Londoners:
The federal government is in the process of cost cutting measures that are not at all helpful in regard to jobs. There have been significant and harmful cuts to services in all parts of the country and London has been as negatively impacted as other regions. HRSDC and Service Canada have been illuminating jobs in our community for the past several years. As of August 31st, more jobs will be lost. Sixteen employees in the Claims Preparation Department of Canada Employment and Immigration will be terminated. This is in addition to the cuts already made. This will leave one employee to perform the many tasks connected with Employment Insurance claims. Across the country, 286 staff who work primarily on Employment Insurance claims will be gone. All too often there are those in the public and media who minimize or completely overlook the fact that public servants are also taxpayers who contribute to the local economy. This recent round of cuts means that 16 employees will no longer be contributing to the economy of London. It means that 16 more families may end up defaulting on a mortgage or car payment. Sixteen more families are not able to dine out at local restaurants or shop at local businesses, and worse, it means when citizens who have lost their jobs need to access EI benefits or re-training programs, they are likely to face even longer waits and encounter more barriers in their efforts to locate job opportunities so they can provide for themselves and their families.
The federal government has created a situation wherein deficit is its only focus. I would, as I have on so many other occasions, suggest that the blanket tax cut policy for profitable corporations ( $60 billion and counting) is not working, does not create jobs and depletes the ability of the federal government to stimulate the economy and maintain services. Rather than savage public services, this federal government would do well to change its corporate tax cut policy and get to work on the priorities of the nation and its communities. This should include a substantial and sustained long term commitment to physical infrastructure replacement and renewal and the creation of social infrastructure. Our cities simply do not have the capacity to overcome the multibillion dollar infrastructure deficit on their own.
I am certain you will hear, as elected representatives always do, that all three levels of government simply need to "cut taxes further" and minimize "red tape". This tired old argument is at best a proverbial "red herring" and at worst simply another indicator of corporate greed run amok. Business in Ontario already enjoys a significant competitive tax advantage. The combined federal and corporate tax rate is 28.5%. This is not only significantly lower than the combined personal income tax rates, it is also significantly lower than the weighted average of the American Great Lakes States which currently sits at 36.6%. As we know, the problem cannot be attributed to London's property tax rates or development charges. Numerous reports have demonstrated that London's tax levy is in the "middle of the pack" when compared with other Ontario municipalities.
We also need to keep in mind that the call to "minimize red tape" is often code for "forget the due diligence, forget good planning, forget minimum standards, and issue me the permit I want". We need to remember that the processes which are in place are there for a reason. Our neighbours in Quebec serve as a reminder of the importance of insisting on high standards. The spate of overpass and bridge collapses in the past few years were in part the result of "cutting corners" and "letting things slide". While there certainly may be reasonable ways to eliminate unnecessary "red tape", we must be cautious and ensure it does not come at the cost of public safety. The long delays for approvals may also be an indicator of inadequate staffing in some city departments.
The provincial government needs to look at the proliferation of temporary employment agencies and address the harm that they do to communities. A temporary agency is not an answer to unemployment ; rather, it is a predatory entity that abuses people who are in the unhappy situation of having lost a job. Far too frequently I hear complaints from constituents about the conduct of an employer, or a temporary employment agency where an employee is told he or she is doing an excellent job until one day before the probationary period ends. That individual is then let go on the spot. Worse still, the employer or temporary agency terminates a group of people in the morning and has the positions reposted for new hires before the day is through. While I recognize that business may have peak periods where additional short term employees are required and temporary agencies can assist in filling those needs, that is no longer the primary reason private sector employers use these agencies. Instead these agencies have replaced human resources managers within the business and become the revolving door that allows companies to avoid paying a decent living wage or providing benefits.
The provincial government needs to introduce legislation to regulate these temp agencies so that people can be hired for more permanent and reliable work. If families are secure, they will boost the local economy and in turn create additional "spin-off" jobs through consumer spending.
I realize that the issues I have raised can only be addressed by the federal and provincial governments, but since you are looking for solutions to joblessness in London, there are some things which can be done locally to start to address the particular problems in our community.
Business must not treat employees as units of disposable inventory. We need our private sector partners, the LEDC, the Chamber of Commerce, and the individual member businesses to understand the harm they cause when they rely on temporary agencies. Temporary employment not only creates an artificial cycle of chronic unemployment, it also prevents people from accruing hours to qualify for Employment Insurance. This is an unacceptable hardship for families who depend on their federal government and the businesses and companies of London for employment stability. Governments, the LEDC and the Chamber of Commerce need to take a leading role to end this abuse of workers.
The municipal government has a role to play in regard to job security. People need reliable public transportation to job sites. The new industrial parks are certainly convenient for employers, and assist municipal planning and development to concentrate industrial development along transport corridors. Unfortunately the opportunity to take a job opening at a business located in these areas is often dependent on private automobile transportation. For individuals caught in a cycle of unemployment, or under employment, a car is simply a luxury they cannot afford. Even relatively affordable used vehicles come with maintenance, insurance and fuel costs which put them out of reach for many. Transit service needs to be reviewed and where necessary upgraded so people can get to work. It is important to have transit service not only for "day shift" workers, but also for those on afternoon or night shifts.
One immediate step the City of London could take is to coordinate with industrial and large business operations on a transit strategy that would address the need of workers at minimum cost to existing transit services. Our business partners, and labour unions must play a role in ensuring shift start and end times are scheduled to allow access to "shift change" transit runs.
Another barrier to an unemployed individual taking an employment offer is the significant lack of affordable childcare spaces in the city. For moms and dads looking to get back into the workforce, and especially for single parents, this can be a barrier they simply cannot overcome and thus they remain unemployed instead of taking an "entry level" job they might otherwise pursue. It is not difficult to understand why a mom or dad would not be interested in taking a job which would leave the family with $20 or $50 less at the end of the week once the childcare costs were paid.
I understand the City has set aside an "Economic Prosperity Fund" with several million dollars that council may invest in the community to help stimulate employment. If the city were to utilize even a small portion of that fund to create new subsidized childcare spaces, it would not only directly create jobs, it would enable more individuals to take jobs which may already be available. Statistically every dollar invested in childcare generates $200 into the economy. It's a very prudent investment.
I recognize that in the long term, the senior levels of government must address the lack of a cohesive, comprehensive plan for childcare in Canada, but as an immediate action this is one way the City of London can step in and knock down a barrier to employment in our community.
In addition, all levels of government can do more when it comes to "providing bang for the buck" with tax dollars. In the last parliament I proposed "Made in Canada" legislation. At the provincial level I know my colleagues have developed a "Buy Ontario Plan" and at the municipal level I know some members of council have considered the wisdom of a local procurement policy as well.
Prosperous jurisdictions like Ontario which once enjoyed a competitive advantage are finding that not only has the advantage disappeared but they are actually now at a disadvantage in many sectors of the global market place. We must resist the urge to join a "race to the bottom". Instead we would do well to remember that in part our competitive advantage was founded in a history where we bought the car our neighbour assembled and when it easy to find clothing "made in Canada" at the department store. I recognize that the world has moved on, but there is still wisdom to be gleaned, in particular when related to the expenditure of public tax dollars, to the advantages of local procurement policies. Such policies are not "protectionist" if properly developed. My own "Made in Canada" legislation was reviewed to ensure legal compliance with NAFTA and other federally negotiated trade agreements. It is likewise possible to develop such a policy at the provincial and municipal levels without violating trade obligations. By spending tax dollars in our community where possible, we are getting more "bang for buck" with those tax dollars. Tax dollars put to work in the domestic market return value continuously back into that economy and lead to private sector job creation. Tax dollars spent overseas create jobs overseas. Made in Canada is a discussion worth having.
I do want to acknowledge that there are positives. London has some significant advantages. We know London has the advantage of owning London Hydro. In an energy based economy with considerable global instability, reliable power service is something we should not undervalue. We have great access to the 401, 402, and 403 highway system. We have UWO and Fanshawe College, the source of a talented and well educated workforce. And we have a diverse city, including a diverse small business community.
I want to thank you for your support of small business and business improvement associations in our city. I know that with support from the federal, provincial and municipal governments there are four more people working in east London to revitalize the Argyle district, with some spin-off jobs already occuring because of that work. I was proud of the role I played in supporting the Argyle BIA, but recognize that without the municipal and private sector support, the initiative would not be the success it is.
The Argyle BIA is also a reminder that when it comes to small business owners and operators, governments need to recognize that small business is the true economic engine of our country and community. While I do not support blanket corporate tax giveaways, all levels of government would be wise to look at targetted tax credits for the small business sector. This type of tax incentive allows small and medium sized businesses to not only create jobs but to reinvest in our community.
One way the city might support small business is to conduct a cost/benefit analysis of property tax credits and the provision of recycling services in commercial areas. It is possible that this would provide small businesses with the kind of savings that would encourage them to locate in London or expand their London operations. At this point in time it seems that London's taxpayers are too often simply subsidizing high vacancy rates for the big commercial landlords.
I hope this perspective facilitates positive discussion. I recognize we all have work to do. There have been successes to be sure, but we still have more in the "lost" column than the "win" column. We need to get London back to a winning record!
I believe it's time for a jobs summit with broader participation. It's time to listen to the people who are unemployed, organized labour, service providers like the Unemployed Help Centre as well as business, LEDC and politicians. There are solutions if we are willing to listen and implement local, practical actions.
Member of Parliament for London-Fanshawe
NDP Critic for Seniors Issues