Gender could be a budget focus

Might address pay gaps, job representation

Next week’s federal budget will be the latest chapter in the Liberal government’s inclusive growth agenda — but early signs are its emphasis will be firmly on inclusion, rather than growth.

Justin Trudeau laid out what will be the budget’s central theme last month in his speech to the World Economic Forum in Davos — bridging the gender gap in the workplace to boost economic performance.

Trudeau quoted a McKinsey Global Institute study that suggested Canada could add $150 billion to its economy over the next eight years if more women entered, and changed, the workforce.

Sources familiar with the budget process said the gender analysis that featured in last year’s document will be turned into concrete action this time around, with measures to give women already in the workplace equal opportunity to succeed and efforts to attract them into non-traditional jobs in the skilled trades and in science and technology.

What this means in practice remains to be seen, but the government has already committed to pay equity at the federal level and could take further steps to identify glaring gaps in public service pay levels — an Ottawa sunshine list modelled on Ontario’s disclosure act.

Another area of concern is the under-representation of women in skilled trades — a study last year suggested women account for just 4.5 per cent of workers in the sector.

One possible way to address this is through the $2 billion Ottawa transfers to the provinces every year for training under the Labour Market Development Agreements.

Last year’s budget noted just 44.5 per cent of LMDA participants were women in 2013-14, an underrepresentation it called “worrisome.”

The feds said they would develop “a new approach to labour market programming” to be more responsive to women — perhaps a skills strategy similar to those that exist for Indigenous and disabled Canadians, though any such changes would need provincial buy-in.

Tanya Van Biesen, executive director of Catalyst Canada, a non-profit group working to accelerate workplace inclusion, said the federal government has done its job by leading by example. But she said government support is not a silver bullet to addressing male-dominated corporate culture.

“That’s where change is going to have to happen. We have to change behaviour.”

The public sector has done a good job promoting women into senior roles but in the private sector only one in four senior managers are female.

From an economic point of view — which is, one hopes, the finance minister’s dominant perspective — there is a good case for more equality.

We have an aging population, with more people in the 55-64 age group than in the 15-24 cohort.

In 2016, 47.7 per cent of the labour force were women, up from 37.3 per cent in 1976. But nearly half work in the 20 lowest-paid occupations — retail sales, admin assistants, cashiers — earning on average 10 per cent less than men.

Economic growth comes only if you add more workers or make existing workers more productive.

Encouraging more women to work and giving them the skills to earn more is not merely “social engineering,” as some of my more dogmatic colleagues believe. But it is a fair criticism of this most quixotic of governments that it spends too much time tilting at windmills to undo perceived injustices, and too little on making the numbers add up.

Conference Board of Canada chief economist Craig Alexander said he thinks the deficit for 2017-18 will be $4 billion less than anticipated because the economy performed better than expected last year. But, he said, the Liberals face significant challenges as growth slows.

Program spending, which has been rising at six per cent a year since Trudeau came to power, needs to fall to three per cent to keep the debt-to-GDP level ticking down. After inflation, that’s a spending increase of one per cent, which is in line with population growth. In other words, there is very little new money to spend unless the government wants to break its remaining fiscal anchor.

Presumably, whatever powder they have left they want to keep dry for a preelection giveaway next year.

Yet there are pressing concerns that will not fit into the Liberals’ reelection timeline.

Tax experts like Prof. Jack Mintz at the University of Calgary have urged the government to lower the corporate tax rate by two points to match recent U.S. cuts that have undermined Canada’s competitiveness.

The NAFTA negotiations add to the gloomy prognosis, with the Bank of Canada estimating investment will drop by two per cent as a result of uncertainty.

Suncor Energy’s chief executive, Steve Williams, said recently his company will pare back spending, partly because Canada is no longer as competitive as other countries. This reflects the reality that large companies in Canada face higher taxes on investment, personal income, sales and carbon emissions than in the U.S.

Yet Trudeau has already ruled out corporate tax cuts in next week’s budget and his rhetoric remains more reminiscent of a social and environmental activist than of a G7 prime minister.

It is that lack of balance that concerns a lot of people who are not necessarily hostile to the diversity agenda.

“The government is focused on socio-economic outcomes to create inclusive government,” said Alexander. “But they need to do both sides of that statement — inclusion and growth.”

If the prime minister is Don Quixote in this analogy, let’s hope Bill Morneau is his Sancho Panza — and that practicality triumphs over rash idealism.