Rural Poverty Discussion Paper Prepared by: Prepared for: Dr. Ausra Burns Rural Secretariat Research Associate Agriculture and Agri-Food Canada Government of Canada David Bruce Director Amanda Marlin Research Associate tel 506-364-2397 fax 506-364-2601 [email protected] Executive Summary Most of the research about poverty in Canada is focused on provincial, national, or urban examinations of the extent and nature of the problem. This discussion paper examines what is known about poverty in general and identifies what is known specifically about poverty in rural Canada. Key questions addressed in the paper include: • Are relatively more or fewer rural people in poverty compared to urban Canada? • Are there differences between urban and rural in the population groups who find themselves in poverty? • Are the causes and/or outcomes of poverty different in rural compared with urban? Definitions For the purposes of this research project we understand ‘rural’ to mean and include “rural and small town Canada” or RST as defined by Statistics Canada - all of those places located outside of Census Metropolitan Area (CMA) and a Census Agglomeration (CA) territories (a CMA has an urban core population of 100,000 and over and a CA has an urban core population of 10,000 to 99,999; each include all neighbouring municipalities where 50 percent or more of the workforce commutes to the urban core). Thus RST includes all cities, towns and villages with populations of less than 10,000, as well as the rural areas surrounding them. Together, these places are home to about 20 percent of our national population. In addition, we understand that rural includes at least five distinct types of rural places, based on the degree of interaction with or influence from a large urban centre, For the purposes of this study we define poverty based on the low income cutoff (LICO) developed by Statistics Canada. Individuals with incomes below the LICO are considered to be in a poverty situation. While this is not the only working definition of poverty, it is one of the most common. Framework for Analysis This paper adopted the elements used to assess or describe “social determinants of health”(Public Health Agency of Canada (PHAC)). These cover a wide range of factors which have been found, over the years through comprehensive research, to have impacts on the health of an individual. In many ways these factors are also related to poverty. Some of these contribute to rural poverty, some can be interpreted as consequences of poverty, but many have relevance to both ‘cause’ and ‘effect’: • Income; • Employment and working conditions; • Economy; • Population demographics; • Housing; Rural Poverty Discussion Paper Page iv • Health; • Education; • Child and youth development; • Gender; and • Culture. These determinants were used as ‘lenses’ or ‘filters’ for both searching for rural poverty evidence or connections, and for organizing the discussion and assessment of the current state of knowledge about rural poverty. These filters were used to summarize existing data, literature and research sources; and to identify knowledge gaps and strategies to address the gaps. Information Sources Canadian literature and data sources from the early 1990s to the present were gathered from the following sources: • Scholarly publications in academic journal articles, reports, and other published and electronic material from a wide range of disciplinary areas including the sciences, social science and humanities. • Federal, provincial and territorial government data, publications, reports and research studies. • Resources available from a range of national and regional research institutes and organizations. Poverty Numbers The incidence of low income is quite different between urban and rural Canada. As shown in the table below, the incidence of low income was very similar in both places in 1981-1986. However, for the 1991-1996-2001 census years the incidence of low income in urban areas rose while it declined in rural areas. Rapidly rising housing costs in most urban centres offers the largest explanation for the rise in low income. In the rural context the relatively flat growth in housing costs coupled with modest income growth helps to explain the drop in the incidence of low income. Within rural the incidence varies by degree of rurality: it has been consistently higher in rural non-metro adjacent areas compared with both metro-adjacent and northern regions. Rural Poverty Discussion Paper Page v Percent of Individuals Living in Households with Income Less Than LICO Predominantly rural regions Year Predominantly Intermediate All Rural metro- Rural non- Rural northern urban regions regions predominantly adjacent metro-adjacent regions rural regions regions regions 1981 15.8 15.2 16.2 15.0 17.6 14.0 1986 17.4 15.3 17.3 15.8 19.2 15.1 1991 17.9 13.5 13.8 12.9 14.9 13.2 1996 23.0 16.6 16.3 15.4 17.5 15.3 2001 18.8 13.6 13.6 12.6 14.7 13.8 Note: The LICO (low income cut-off) is not calculated for individuals living on Indian Reserves or individuals living in the Territories. Source: Statistics Canada. Census of Population, 1981 to 2001. There are some variations from one province to the next with respect to urban-rural differences related to incidence of low income. In 2001 rural poverty was more prevalent in Newfoundland and Labrador, Nova Scotia, Saskatchewan, and New Brunswick, and less of a problem in rural Ontario, Alberta, and Prince Edward Island. Within rural regions of each province there are few examples of variation; however, poverty rates are higher in non-metro-adjacent regions in New Brunswick, Québec, and Manitoba than it is in rural metro-adjacent regions of their provinces. Rural northern regions in Saskatchewan and Manitoba have higher poverty rates than in other rural parts of those provinces. Urban poverty is more prevalent than rural poverty in all provinces. A major study examined urban poverty in the 1990s with special tabulations from the 1991 and 1996 census. The research found that the major groups with highest rates of urban poverty in 1995 included: • Lone-parent families (59.2%) • Aboriginal identity (55.6%) • Unattached individuals (45.2%) • Visible minorities (37.2%) • Persons with disabilities (36.1%) • Youth age 15-24 (30.7%) • Immigrants (30.0%) • Children under age 15 (29.8%) • Seniors age 65 and over (25.0%) Our review of the literature on rural poverty suggests the following groups of sub-populations are most vulnerable to rural poverty: children, women (including lone parent families), immigrants, seniors, and Aboriginal people. However, we do not have access to specific, published, poverty rates for each of these populations. Although these populations are similar to those impacted by poverty in urban regions, due to the special nature of rural regions, the number of people in each group who are impacted likely varies between urban and rural, and the nature and magnitude of Rural Poverty Discussion Paper Page vi the impacts on these rural populations may also differ from their urban counterparts. Causes of Rural Poverty Over the last decade rural Canada’s economic and employment situation has had the most profound negative impact on its residents. While variations exist among provinces, when compared to their urban counterparts, rural residents are known to have lower incomes and fewer employment opportunities. These important causes of poverty encourage and sustain persistent rural-to-urban migration. Although relatively few studies exist to statistically measure the specific causes of rural poverty, generally speaking many of the same factors are likely contributing to both urban and rural poverty. Where there are differences between urban and rural causes, the depth of the problems may be different within each factor. For example, while being poorly educated and without employment are known to contribute to a poverty outcome, regardless of where one lives, the depth of these problems vary by geography. Compared to their urban residents, rural residents tend to have lower education levels, lower levels of literacy, lower incomes, fewer job opportunities, fewer higher paying job opportunities, more seasonal employment, more housing that is in need of repairs, relatively poorer health, and relatively poorer access to health care services. Rural Poverty Outcomes Some of the impacts of poverty are similar in both rural and urban regions of Canada. These include impacts on education (not doing well in school, and lack of ability to pay for post secondary school, especially university), risk of homelessness, increased need to use food banks, and shorter life expectancies. However, there are some marked differences in impacts of poverty between rural and urban regions. Poverty in rural areas can lead to a significant out-migration with many residents leaving in search of better employment. Individuals and families leave rural communities to avoid or to escape poverty. As rural areas already have small populations this can have a devastating impact on vital social and health services, which may be forced to close. Many poverty outcomes which include problems associated with attaining quality housing, education and maintaining good health, are also causes of poverty. These intertwined ‘attributes’ of poverty point to a continuous vicious cycle with poverty’s pervasive negative impacts influencing generation after generation of vulnerable population groups including those among rural Canadians. Knowledge Gaps Most of the published knowledge about poverty tends to have a national, inter-provincial, or urban focus or lens. Many of the national data sets and studies employed by Statistics Canada, for example, report on poverty and related issues without an analysis of the variation between urban and rural (with the exception of the LICO releases). Most of the potentially interesting analyses at Rural Poverty Discussion Paper Page vii finer levels of geography (rural census divisions, rural Zones of Metropolitan Influence - MIZ, etc.,) for data captured by Statistics Canada is not possible for a variety of reasons, including data suppression, costs of coding and data management, and so on. The work of most advocacy groups and think tanks (National Anti-Poverty Organization - NAPO, Canadian Council on Social Development - CCSD, National Council of Welfare - NCW, Canadian Policy Research Networks - CPRN, and others) rightly focus on the broader national policy issues with the intention to influence change that will benefit all citizens in poverty situations, regardless of where they live. However, when they do undertake research or release their analyses on particular issues, their focus is similarly on the national picture (with some analysis across various demographic lines or among specific populations such as children or women without regard for geography or place), comparisons among provinces, or reporting on urban issues. These groups could be encouraged, where possible, to include urban-rural comparisons or variations in some of their reporting of poverty issues and characteristics, with corresponding suggestions for any relevant variance in policy or program interventions that may be more appropriate in a rural setting. A variety of strategies may be needed to ensure that data is collected and research is conducted on these and other issues. Four overarching strategies are suggested which, taken together, will go a long way to furthering research into rural poverty issues: • Establish a partnership among the Rural Secretariat, Statistics Canada, Social Sciences and Humanities Research Council (SSHRC), and any other interested department or agency, to establish and fund a specific strategic research grant theme examining rural poverty. The opportunity here is to take advantage of SSHRC’s application and evaluation process, multi- department funding for research (so the burden does not fall to one department), and the variety of national databases and sources managed by Statistics Canada (including censuses, surveys, taxfiler data, etc.,) to encourage and nurture targeted research on rural poverty. • New issues of the Rural and Small Town Canada Analysis Bulletins developed by Statistics Canada could include sub-analysis of people in low income or poverty situations. For example, in a future update profiling the socio-economic characteristics of immigrants in rural Canada, one of the variables for analysis could be comparing those in low income situations to those who are not, with further analysis and commentary related to the geographic distribution across the MIZ categories. • Most federal and provincial government departments and agencies have a variety of administrative data files (for example, data records for clients with active employment insurance claims, clients on social assistance, etc.). These data files are rich in terms of the range of information they contain. Partnerships between researchers and these departments and agencies could be struck to undertake creative and interesting research. Careful attention to removing individual identifiers coupled with aggregation of data into agreed upon clusters can ensure that confidentiality is protected while providing scope for valuable policy research. Rural Poverty Discussion Paper Page viii • Encourage the CCSD (or another research institute or advocacy group) to replicate its study Urban Poverty in Canada: A Statistical Profile (Lee, 2000) using updated 2001 and 2006 census data, and extend the geographies of analysis to include rural (including the four MIZ designations and northern and remote). This may require specific funding from a variety of departments and agencies. Rural Poverty Discussion Paper Page ix Table of Contents 1.0 Introduction ............................................................1 2.0 Research Approach ......................................................2 2.1 Defining Rural and Poverty .............................................2 2.2 Framework for Analysis ................................................3 2.3 Information Sources ..................................................3 3.0 Overview of Poverty in Canada .............................................5 3.1 Measures of Poverty...................................................5 3.2 Poverty Numbers ....................................................10 3.3 Social Assistance Benefits .............................................16 3.4 Poverty Among Vulnerable Populations in Rural Canada .....................17 4.0 Causes and Outcomes of Poverty...........................................30 4.1 The Causes of Rural Poverty ...........................................30 4.2 The Outcomes of Poverty in Rural Communities ...........................44 5.0 Knowledge Gaps and Strategies for Data Collection, Analysis and Research ........53 6.0 Conclusions ...........................................................56 Rural Poverty Rates .....................................................57 Special Populations and Poverty ...........................................58 Causes and Outcomes of Poverty...........................................58 References Cited ..........................................................60 Additional References ......................................................69 Appendices ...............................................................75 Rural Poverty Discussion Paper Page x