Ottawa’s response to ‘gig economy’ hindered by unreliable data, documents say

Documents show feds were unsure of existing data on number of Canadians earn livings online

A Lyft logo is installed on a Lyft driver’s car next to an Uber sticker. THE CANADIAN PRESS/AP/Gene J. Puskar, File

A newly released government document shows that federal officials feel stymied by data roadblocks in their bid to help policymakers tackle a growing political concern about the country’s “gig” economy.

Documents obtained by The Canadian Press under the Access to Information Act show federal officials were leery of the reliability of existing data on the number of Canadians using online platforms to earn their livings, even though the figures had come from reputable sources.

The late-March briefing note shows officials at Employment and Social Development Canada were looking for alternatives.

Federal officials have been closely watching the changes in the labour force away from full-time jobs in favour of more temporary, part-time or contract work.

Available research suggests young people are more often found in these positions, which can be lower-paid and without benefits or longer-term job security. That makes the effects of the gig economy of particular interest to politicians: millennials make up the largest voting cohort this election season.

Concerns about the ripple effects have prodded changes to the Canada Pension Plan, analysts’ deep policy dives into the future of the federal social safety net, new spending on skills training and amendments to the federal labour code.

What makes measuring the size of the gig economy so difficult is that there are competing definitions of what it includes. ESDC officials leaned on an American definition that described gig workers as those who take short work or tasks through websites or mobile apps that arrange payment and connect them directly to consumers.

For instance, driving Ubers, making SkipTheDishes deliveries, or picking up odd work from TaskRabbit. Putting together multiple part-time jobs, soliciting work through a website such as Kijiji, or surviving on short-term contracts didn’t count.

Underlying concerns about the gig economy is a demographic shift firmly underway in Canada. Aging baby boomers will retire in droves over the coming years without enough young workers to replace them — which raises a potential problem. Unlike the Canada Pension Plan, old-age security payments are funded by tax dollars, and federal coffers might not be able to cover the cost of seniors’ benefits that are increasing faster than inflation.

Add to that populist concerns about immigrants, who have been the main drivers of population growth as birth rates have declined, and there is a potential potent mixture for the coming election campaign.

What to do beyond election day has engrossed federal officials from multiple departments, who have tested worst-case scenarios and a range of possible policy responses.

Armine Yalnizyan, an economist who has researched the gig economy in detail, said available data suggests a growth in the platforms could erode wages for engineers, accountants, programmers and lawyers as companies connect with cheaper overseas labour. Federal programs either provide workers with capped income supports — which for high-wage workers would be well below the earnings they’re used to — or retraining funding, she said.

READ MORE: Bank of Canada offers explanations for country’s ‘puzzling’ wage disappointment

“This isn’t the hollowing out of the middle, this is the hollowing out of the high-skill, high-wage class and we don’t have programs for that crowd,” Yalnizyan said.

“What are you going to train them in? They’ve just spent seven to 10 years training and spent a fortune on it. Obviously, our systems are not designed for that reality and that’s where we’re hitting the stress tests.”

Jordan Press, The Canadian Press

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