Ottawa’s economy is growing and, on average, its workers are earning more. But while the good times seem to be rolling, the city’s most vulnerable residents are sinking deeper into poverty, according to a new study.
A report by the Social Planning Council of Ottawa reveals that Ottawa’s median individual income rose 9.8 per cent between 2000 and 2005 to $33,024. However, it also shows an increase in the depth of poverty, with low-income households, on average, living $7,800 below the low-income cut-off.
In 2000, the average was $6,900 below the low-income cut-off.
The low-income cut-off is the point at which people spend more than 50 per cent of their incomes on essentials such as rent, clothing and food.
Ottawa’s growing prosperity is driving up the cost of living in the city, which is driving the city’s poor deeper into poverty, the report concludes.
The study points to four factors that drive poverty in the city: a changing labour market (with a growth in low-paying service industry jobs and a decrease in blue collar work), a lack of affordable housing, social policies that have not kept pace with inflation, and factors affecting equity in groups such as visible minorities and aboriginal people.
According to the report, poverty affects certain groups in Ottawa disproportionately.
Almost half of lone-parent families in the city live in poverty. Recent immigrants and unattached individuals also experience high levels of poverty.
However, those most affected by poverty are youth aged 15 to 24, 70 per cent of whom live under the low-income cut-off.
The poorest neighbourhood in Ottawa is Centretown, with 27 per cent of its residents living below the low-income cut-off.
Diane Urquhart, executive director of the Social Policy Council of Ottawa, says the growing gap between the city’s rich and poor is creating an Ottawa of two cities.
“Being poor in Ottawa is not the same as in other cities — it’s a different dynamic to be poor in a rich city,” says Urquhart.
She says its hard for poor residents to obtain good-paying entry-level work because the main employer — the federal government — requires bilingualism, criminal background checks and post-secondary degrees. Urquhart says that Ottawa is also different than other cities because it lacks a strong manufacturing sector, which would offer better entry-level opportunities.
“We don’t have a labour market that offers upward movement,” says Urquhart.
Instead, the city’s growing service industry offers part-time, minimum-wage work. Urquhart says that is increasing the number of “working poor” — now up to five per cent of the city’s workforce.
Urquhart presented her report to city council this week, as Ottawa begins to implement its poverty reduction strategy.
While Urquhart says the city is taking steps toward addressing the issues, she is concerned that the plan lacks mechanisms to measure the effect of new policies.