What does record inflation mean for household food insecurity in Canada?

Photo of money with transparent bars showing graph of inflation rate.

Canadians are feeling sticker shock everywhere — at the grocery store, at the gas pumps, and on their utility bills. The rising costs of living is a major concern for most. For the millions who were already struggling to afford the food they needed, inflation will make their circumstances even more difficult.

According to Statistics Canada, the inflation rate in February 2022 reached the largest year-over-year increase since August 1991 at 5.7%.[1] The surging price of groceries, most recently increasing 7.4% year-over-year in February, is certainly cause for concern, but so are the dramatic increases in the costs of shelter, energy, and other necessities. Food insecurity is not only about food, but rather the ability for households’ financial circumstances to afford food and other basic needs.

Food-insecure households spend substantially less on everything, including rent, mortgages, clothing, and other essentials like transportation.[2] They are also more likely to make other financial compromises like delaying or foregoing prescription medications.[3]

At the core of this problem is income inadequacy.

Based on the most recently available estimates from the 2019 Canadian Income Survey, 5.7 million Canadians lived in food-insecure households.[4] Their incomes have been inadequate for basic needs and will become more so now.

What is the potential impact of inflation?

The unprecedented levels of inflation we are seeing will make household food insecurity worse, as food-insecure Canadians or those on the cusp find themselves without the financial means to absorb the extra costs and are forced to make compromises.

If nothing is done to increase the incomes of vulnerable households in line with the rising costs of living, we can expect to see both the prevalence and severity of food insecurity increase. That means more people will cut meal sizes, skip meals, or go whole days without eating because there isn’t enough money for food.

Given the strong link between household food insecurity and mental and physical health problems, worsening food insecurity could have major consequences for people’s health and wellbeing and for the health care system.[5][6][7][8] Food-insecure adults are more likely to need health care services and incur more health care costs.[9][10][11][12]

Who are most vulnerable?

Food insecurity is a serious problem for working Canadians with wages not being enough for many Canadians to make ends meet. In fact, the majority of food-insecure household in Canada rely on employment incomes.[13] The most vulnerable in the workforce are low-wage earners, workers in part-time, short term, or precarious jobs, racialized workers, and those providing for multiple people with a single income.14

The majority of food-insecure households in Canada are in the workforce.

For as long as we’ve had data on household food insecurity, we’ve seen that households relying on social assistance, our income support program of last resort, are very high risk of food insecurity.[13] Social assistance benefit levels have too low for most recipients to meet their basic needs.

The current design of social assistance programs in Canada sees the majority of recipients unable to make ends meet. Graphic: Bar graph of proportion of households reliant on social assistance who were food-insecure by province and territory.

What needs to be done to address food insecurity in light of this inflation?

Reducing food insecurity requires improving the incomes for low-income households.[15][16][17][18][19] The increasing pace of inflation turns up the alarms on the need to reconcile wages, social assistance, and other income supports, and the actual costs of living. Critical policy levers like minimum wage and social assistance lie at the provincial and territorial level.[15]

It also highlights the importance of incorporating indexation into the design of social policies to ensure that welfare incomes, minimum wages, and benefits at least keep up with inflation. (See David Macdonald’s article “Not all provinces protect their poorest from inflation” in The Monitor for an overview of indexation of federal and provincial/territorial policies)

Adequate wages

Setting higher minimum wages that align with the costs of living is one thing governments can do to support low-income workers and reduce food insecurity, especially at a time of surging prices.[15]

While indexation currently safeguards minimum wages from falling behind inflation in most provinces and territories, wages need to be brought up to a more adequate baseline level. Efforts to address job precarity, racism in the labour market, and improve income supports for low-income working households are also needed.

Adequate social assistance

Given the high risk of food insecurity — and more severe food insecurity — associated with being on social assistance, lifting supports to an adequate level must be a priority.[20]

Only 3 provinces and territories that currently index their support rates (New Brunswick, Quebec, Yukon),[21] but even in those jurisdictions, the rate of food insecurity among households relying on social assistance remains very high.[13]

Policy action to help benefits keep up with inflation, like indexation or other increases to bridge the gap, can help mitigate inflation’s impact. However, benefit levels must be higher everywhere if they are to be adequate.

The way forward

How Canadians will manage through these times will depend on how provincial and territorial governments respond. With forecasts suggesting an extended period of high inflation and even steeper increases to the prices of necessities to come, they should act now to better support the incomes of the working poor and those in need of social assistance.

The consequences of inaction are worsening food insecurity, further deterioration of people’s health, and greater drain on our healthcare services and budgets.

Our public policies have left low-income Canadians, particularly working age adults and their families, behind for a long time. The mounting unaffordability of basic needs highlights what years of food insecurity monitoring has been telling us — we must examine the adequacy of wages and our social safety net, and institute policies to ensure everyone has enough money to meet their basic needs.

References

  1. Statistics Canada. Consumer Price Index, February 2022 [Internet]. The Daily. 2022; Available from: https://www150.statcan.gc.ca/n1/daily-quotidien/220316/dq220316a-eng.htm
  2. St-Germain A-AF, Tarasuk V. Prioritization of the essentials in the spending patterns of Canadian households experiencing food insecurity. Public Health Nutrition. 2018; 21(11):2065–78. Available from: https://www.cambridge.org/core/journals/public-health-nutrition/article/prioritization-of-the-essentials-in-the-spending-patterns-of-canadian-households-experiencing-food-insecurity/64779603D298DAF755D6A3FC14A800F1
  3. Men F, Gundersen C, Urquia ML, Tarasuk V. Prescription medication nonadherence associated with food insecurity: a population-based cross-sectional study. CMAJ Open. 2019; 7(3):E590–7. Available from: http://www.cmajopen.ca/content/7/3/E590
  4. Caron N, Plunkett-Latimer J. Canadian Income Survey: Food insecurity and unmet health care needs, 2018 and 2019 [Internet]. Ottawa: Statistics Canada; 2022. Available from: https://www150.statcan.gc.ca/n1/pub/75f0002m/75f0002m2021009-eng.htm
  5. Tarasuk V, Mitchell A, McLaren L, McIntyre L. Chronic physical and mental health conditions among adults may increase vulnerability to household food insecurity. The Journal of Nutrition. 2013; 143(11):1785–93. Available from: https://doi.org/10.3945/jn.113.178483
  6. Jessiman-Perreault G, McIntyre L. The household food insecurity gradient and potential reductions in adverse population mental health outcomes in Canadian adults. SSM – Population Health. 2017; 3:464–72. Available from: https://www.sciencedirect.com/science/article/pii/S2352827316301410
  7. Men F, Gundersen C, Urquia ML, Tarasuk V. Association between household food insecurity and mortality in Canada: a population-based retrospective cohort study. CMAJ. 2020; 192(3):E53–60. Available from: https://www.cmaj.ca/content/192/3/E53
  8. Men F, Urquia ML, Tarasuk V. Examining the relationship between food insecurity and causes of injury in Canadian adults and adolescents. BMC Public Health. 2021; 21(1):1557. Available from: https://doi.org/10.1186/s12889-021-11610-1
  9. Tarasuk V, Cheng J, de Oliveira C, Dachner N, Gundersen C, Kurdyak P. Association between household food insecurity and annual health care costs. CMAJ. 2015; 187(14):E429–36. Available from: http://www.cmaj.ca/lookup/doi/10.1503/cmaj.150234
  10. Tarasuk V, Cheng J, Gundersen C, de Oliveira C, Kurdyak P. The relation between food insecurity and mental health care service utilization in Ontario. Can J Psychiatry. 2018; 63(8):557–69. Available from: http://journals.sagepub.com/doi/10.1177/0706743717752879
  11. Men F, Gundersen C, Urquia ML, Tarasuk V. Food insecurity is associated with higher health care use and costs among Canadian adults. Health Affairs. 2020; 39(8):1377–85. Available from: http://www.healthaffairs.org/doi/10.1377/hlthaff.2019.01637
  12. Men F, Urquia ML, Tarasuk V. Pain-driven emergency department visits and food insecurity: a cross-sectional study linking Canadian survey and health administrative data. CMAJ. 2022; 10(1):E8. Available from: http://www.cmajopen.ca/content/10/1/E8.abstract
  13. Tarasuk V, Mitchell A. Household Food Insecurity in Canada, 2017-2018 [Internet]. Toronto, ON: Research to identify policy options to reduce food insecurity (PROOF); 2020. Available from: https://proof.utoronto.ca/resources/proof-annual-reports/household-food-insecurity-in-canada-2017-2018/
  14. McIntyre L, Bartoo AC, Emery JH. When working is not enough: food insecurity in the Canadian labour force. Public Health Nutr. 2014; 17(1):49–57. Available from: https://www.cambridge.org/core/product/identifier/S1368980012004053/type/journal_article
  15. Men F, Urquia ML, Tarasuk V. The role of provincial social policies and economic environments in shaping food insecurity among Canadian families with children. Preventive Medicine. 2021; 148:106558. Available from: https://www.sciencedirect.com/science/article/pii/S0091743521001420
  16. Brown EM, Tarasuk V. Money speaks: Reductions in severe food insecurity follow the Canada Child Benefit. Preventive Medicine. 2019; 129. Available from: https://www.sciencedirect.com/science/article/pii/S0091743519303524
  17. Loopstra R, Dachner N, Tarasuk V. An exploration of the unprecedented decline in the prevalence of household food insecurity in Newfoundland and Labrador, 2007–2012. Canadian Public Policy. 2015; 41(3):191–206. Available from: https://utpjournals.press/doi/10.3138/cpp.2014-080
  18. McIntyre L, Dutton DJ, Kwok C, Emery JCH. Reduction of food insecurity among low-income Canadian seniors as a likely impact of a guaranteed annual income. Canadian Public Policy. 2016; 42(3):274–86. Available from: https://utpjournals.press/doi/10.3138/cpp.2015-069
  19. Li N, Dachner N, Tarasuk V. The impact of changes in social policies on household food insecurity in British Columbia, 2005–2012. Preventive Medicine. 2016; 93:151–8. Available from: https://www.sciencedirect.com/science/article/pii/S0091743516303048
  20. Tarasuk V, Fafard St-Germain A-A, Mitchell A. Geographic and socio-demographic predictors of household food insecurity in Canada, 2011–12. BMC Public Health. 2019; 19(1):12. Available from: https://doi.org/10.1186/s12889-018-6344-2
  21. Macdonald D. Not all provinces protect their poorest from inflation [Internet]. The Monitor. 2021; Available from: https://monitormag.ca/articles/not-all-provinces-protect-their-poorest-from-inflation