B.C.’s economic system needs a serious overhaul.
That’s according to Paul Kershaw, a Pitt Meadows resident and UBC associate professor who opened a forum at the Langley Township Civic Facility by talking about ‘Generation Squeeze’ and the economic pitfalls facing today’s young adults.
“B.C. has the worst performing economy in Canada for younger generations,” Kershaw said following his presentation on Thursday, Nov. 2.
“Earnings are down and home prices have gone up so much that as a result, it takes years more to cover the cost of living.”
If you want to understand how Langley is doing for young children, we need to look at how the economy is performing for the generation raising them,” Kershaw said.
“And right now, the economy is failing those younger generations because it’s not allowing hard work to pay off like it used to, and that then squeezes (young people) for time, and it squeezes them for services like child care, which is hard to find and costs more than another mortgage-sized payment.”
Young adults are also squeezed for money as well as government and environmental debt, Kershaw noted: “That is a big domino effect that’s created by an economy that’s failing the younger demographic.”
The Langley Early Years Centre, in partnership with and funded by the Ministry of Children and Family Development, hosted the forum called “Through The Eyes of Langley’s Children: A Conduit for Change.”
The forum was the first in a three-part cross-sectoral professional development training for professionals.
The purpose is to bring an awareness of the state of B.C.’s youngest children and facilitate conversation in order to build support and partnerships among agencies and municipalities.
“It is our belief and hope that this session and the initial conversations that follow, will increase our knowledge base and shared understanding so that we may provide meaningful impact and elicit positive change within our communities to best meet the needs of our children and families moving forward,” said Langley Early Years Centre co-ordinator Alicia Stark, leading up to the forum.
Kershaw painted a grim picture.
“In Metro Vancouver, when my mom was my age, it took her five to six years to save a 20 per cent down payment on an average price home,” Kershaw said. “Now, in Metro Vancouver, it takes 27 years. That is a massive deterioration in the standard of living for young adults who happen to be in their prime child-bearing and rearing years.”
Kershaw said there are a range of solutions. One of the most important of which is to first acknowledge that the economy will fail younger people as long as society tolerates home prices leaving earnings behind.
So how do we commit to the principle of homes-first philosophy?
“Homes-first reminds us that the primary purpose of the real estate market is the efficient supply of suitable homes that are in reach of what typical people earn,” Kershaw said.
“If you can make a return on your housing investment, that’s fabulous but it now needs to be a secondary consideration with first keeping home prices within reach.”
Kershaw believes adopting that principle would spark a series of policy changes, including a surge in housing supply that would create competition in the market and in turn would cool prices.
“Let’s restrict harmful demand where people are purchasing homes and leaving them empty or just renting them out to vacationers rather than people who work or study here,” Kershaw said.
He also suggested reducing income taxes, and compensating for that by taxing real estate wealth differently “so we can raise money fairly for medical care and other things.”
Finally, Kershaw said, now’s the time to curb monthly child care fees, so they aren’t the equivalent of another mortgage payment.
“If we can do those kinds of things, we’d better position young adults to deal with the new reality of high home prices,” Kershaw said.
Don’t be fooled by B.C.’s boast that it has fastest-growing Gross Domestic Product in the country, Kershaw warned.
“What makes our economy grow faster than any other province is that real estate is bigger in our province than anywhere else, and that would be OK if we had lots of jobs in real estate, but we don’t.
“As a result, our economy is growing based on the following strategy: let’s raise the cost of living without creating enough jobs that keep earnings in pace. That’s a bad model for economic growth.”
Other guest speakers on Nov. 2 included Joanne Schroeder and John Stark.
Schroeder is the executive director of Comox Valley Child Development and the recent recipient of the Max Bell Foundation Policy Fellowship Association hosted by the Human early Learning Partnership.
Stark is the acting manager of planning with the City of New Westminster.