The program intended to keep the Canadian economy running, could be hurting it in some cases, according to a Richmond business owner who said he couldn't get his employees to return to work because they are collecting CERB.
Dazhong Wang, the owner of a stone fabrication company located next to Richmond's Ikea, said he has "begged" his employees to come back to work or even work shorter hours, so he can get projects completed.
"But my employees found that collecting $2,000 a month from Canada Emergency Response Benefit (CERB) is more enjoyable than working at the construction sites," said Wang.
"I have too many big projects piling up, but I couldn't find people to work for me. And some of them told me they wouldn't be back until I am willing to pay them under the table (in cash). Unfortunately, I don't have enough cash. I am almost running out of cash."
Wang added that his isn't an isolated case. Many factory owners hiked wages and offered free meals as a bonus to lure workers into keeping their production running.
"For employees who aren't experienced, I would pay them $22 an hour. For more senior workers, they can earn $28-35 an hour," noted Wang, adding that if employees are committed to working full-time, they could earn up to $5,000 a month.
"I understand that many people are in desperate need of financial relief…But I also want people to know that many business facilities are trying hard to keep their doors open, and they are operating at a loss. We are also struggling."
Taiwo Aderemi, an economics professor at KPU, challenges Wang’s claims and argues that most people who can earn a net income of $3,500 or more do return to work -- despite being eligible for CERB.
However, that’s not the case for low-wage earners, said Aderemi.
"Low-income earners at higher risks for COVID-19 infection," KPU economics professor
For low-income earners, particularly those in vulnerable sectors where the risk of contracting the virus is high, more of them prefer to remain unemployed, reduce their risk of exposure and rely on CERB; they will go back to work when things get back to normal, said Aderemi.
For instance, B.C.'s minimum wage is at $14.60 per hour. A full-time low-skilled worker will earn a net income of about $1,964 per month after-tax, Aderemi explained.
"So you are given two options, the first is earning CERB at $2,000 with less risk exposure to COVID-19. The second is going back to work and earning $1,964 monthly, or a bit higher or lower, and exposing yourself and your family to COVID-19.
"The damage involved in contracting the virus is unquantifiable in terms of the health burden, stigmatization, discomfort and even likely death," said Aderemi, noting there is little incentive to go back to work for workers earning below the CERB.
However, for a middle or high-income earner, whose net income is around $3,500 monthly, the CERB might not be enough to meet their family's needs. If this person can find a better job that pays more than CERB, he or she will not hesitate to go back to work, argued Aderemi.
"Generally, there must be an incentive for you to go back to work. So, every worker weighs the ups and downs in terms of pay earned compared to CERB payment, career advancement, risk exposure to the virus, etc.
"Remember that these low-wage workers are often the most exposed to the virus due to the nature of their work," added Aderemi.
However, if a person can find a job that pays more than CERB, he or she will not hesitate to go back to work, he added.
And even if CERB is hurting some employers, he argues that providing people with spending power is in the economy’s best interest overall.
