The role of the Canada Emergency Response Benefit in alleviating the impact of the COVID-19 pandemic on the employment income of racialized workers
Released: 2024-05-23
The COVID-19 pandemic exacerbated income disparities and inequalities within the Canadian population. It had a greater impact on the earnings of some population groups, particularly racialized groups, immigrants, women and youth. However, the Canada Emergency Response Benefit (CERB) program, one of the measures implemented to support workers during the pandemic, offset most of the earning losses of Canadian workers during this period. CERB payments made an important contribution to closing equity gaps in economic well-being between non-racialized and racialized workers—particularly racialized women—that could have otherwise worsened substantially during the pandemic.
According to results from a new study released today, entitled "The role of the Canada Emergency Response Benefit in alleviating the impact of the COVID-19 pandemic on the employment income of racialized workers," racialized workers were more likely than their non-racialized counterparts to receive financial support through the CERB. This reflected both higher levels of overall job loss/interruption and greater employment income losses experienced by racialized workers, particularly racialized women, compared with non-racialized workers. This was in part due to racialized workers' higher representation in sectors affected by lockdowns and closures, such as the food and accommodation sector, and in occupations with higher risks of contracting COVID-19, such as nurse aide, orderly and patient service associate occupations. Nevertheless, these employment income losses were largely offset by CERB payments for both racialized and non-racialized workers, and completely offset for racialized women workers.
Employment income losses are greatest among racialized workers
Overall, one in four Canadian workers (25%) received financial support through the CERB in 2020. A greater share of racialized workers (29%) than non-racialized workers (24%) received this benefit, with racialized women (30%) being more likely than racialized men (27%) to receive the CERB.
Among those who received financial support through CERB, declines in employment income from 2019 to 2020 were proportionally greater among racialized women (-23%) and racialized men (-20%), compared with their non-racialized counterparts (-17% for women and -15% for men).
Canada Emergency Response Benefit payments mitigate employment income losses among racialized workers
Workers who received the CERB lost an average of $8,100 in employment income, which was largely offset by $7,600 of financial assistance from the CERB program (i.e., $0.95 of assistance per dollar lost).
CERB payments did not replace all the employment income lost by racialized men ($0.83 of assistance per dollar lost) and non-racialized men ($0.78 of assistance per dollar lost). In contrast, these supports more than offset lost income among racialized women ($1.09 of assistance per dollar lost) and non-racialized women ($1.17 of assistance per dollar lost).
Overall, CERB payments stabilized the income of workers affected by the pandemic. In 2020, the median employment income plus CERB payments amounted to $41,000 among racialized men who received these payments. While this still represented a loss of 3% compared with employment income in 2019, this loss was lower than the decline observed when considering 2020 employment income without CERB payments (-20%). A similar situation was observed for non-racialized men, whose median employment income dropped by 2%, compared with 15% without CERB payments.
For racialized and non-racialized women workers who received CERB payments, CERB replaced lost earnings completely. The median employment income plus CERB payments of racialized women who received these payments rose from $33,700 in 2019 to $34,300 in 2020 (+2%), while that of their non-racialized counterparts rose from $35,100 to $36,600 (+4%) over the same period.
Overall, when CERB payments were added to employment income, the income gap between racialized workers and non-racialized workers was 11%, similar to the employment income gap in 2019 (10%), and lower than the 2020 employment income gap without CERB (16%).
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Note to readers
Data sources
This study uses data from the 2021 Census of Population on financial aid received through the Canada Emergency Response Benefit, as well as 2019 and 2020 income, extracted from tax files. The reference periods for the income variables are calendar years 2019 and 2020. Income for 2019 is presented in 2020 constant dollars. The census was carried out during the week of Sunday, May 2 to Saturday, May 8, 2021.
The analytical sample includes core-aged employees (25 to 54 years old) with sufficient employment incomes in the year preceding the pandemic (i.e., at least $10,600 in 2019 and $3,980 in 2020). Self-employed workers, recent immigrants, non-permanent residents, and Indigenous people are excluded from the study.
Racialized population: The concept of racialized population is measured with the "visible minority" variable. This information has been collected by Statistics Canada since the 1996 Census of Population to implement the Employment Equity Act. The "non-racialized" group is measured with the category "Not a visible minority" from the variable, excluding Indigenous respondents. Indigenous respondents are not part of the racialized group, nor the non-racialized group.
"Visible minority" refers to whether or not a person belongs to one of the visible minority groups defined by the Employment Equity Act. The Act defines visible minorities as "persons, other than Aboriginal peoples, who are non-Caucasian in race or non-white in colour." The visible minority population consists mainly of the following groups: South Asian, Chinese, Black, Filipino, Latin American, Arab, Southeast Asian, West Asian, Korean, and Japanese.
Employment income: This refers to gross wages and salaries before deductions, pension plan contributions and employment insurance premiums during the reference period. While other employee remuneration such as security options benefits, board and lodging and other taxable allowances and benefits are included in this source, the employer's contributions to pension plans and employment insurance plans are excluded. Other receipts included in this source are military pay and allowances, tips, commissions and cash bonuses associated with paid employment, benefits from earnings-loss replacement plans or income-maintenance insurance plans, supplementary unemployment benefits from an employer or union, research grants, royalties from a work or invention with no associated expenses and all types of casual earnings during the reference period.
Products
The article entitled "The role of the Canada Emergency Response Benefit in alleviating the impact of the COVID-19 pandemic on the employment income of racialized workers" is now available in Insights on Canadian Society (75-006-X).
Contact information
For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; infostats@statcan.gc.ca) or Media Relations (statcan.mediahotline-ligneinfomedias.statcan@statcan.gc.ca).
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