August 23, 1999
To:Community Services Committee
From:Commissioner, Community and Neighbourhood Services
Subject:Ontario Works Caseload Profile
Purpose:
This report describes important changes in the City's social assistance caseload through the 1990's, focussing on overall
caseload growth and decline, as well as on key trends related to caseload composition and to changes in the length of time
clients remain on assistance. The implications for the delivery of Ontario Works is then summarized.
Recommendations:
"It is recommended that this report be received for information."
Background:
Social assistance caseloads have fluctuated in an unprecedented way in the 1990's. A period of rapid increase in the first
half of the decade has been followed by a period of continuous caseload decline. However, the rise and fall of the City's
caseload is only one dimension of the massive changes that have occurred. Who is receiving assistance and how long
clients are remaining on assistance, and why, are the basic questions that, when answered, provide a true sense of the
transformation of the City's caseload.
The introduction of the Ontario Works program, and the passage of the new Ontario Works Act, have fundamentally
altered social assistance, making it an employment focussed program. For this reasons, it is more important than ever to
understand caseload trends and dynamics as a basis for addressing clients' service and support needs in a way that
facilitates their return to work. To that end, this report identifies and discusses key caseload trends, and briefly assesses the
implications thereof for clients and for the Social Services Division. The analysis is primarily based on caseload data from
the Division's computer data bases with economic data drawn from a range of sources.
Discussion:
I.Recent Caseload Trends:
There is a well known historical relationship between Toronto's social assistance caseload and the broader economy.
Changes in the rate of economic growth, and specifically in the rate of employment growth, strongly influence caseload
trends. This was dramatically illustrated in 1989, with the onset in Toronto of the worst recession in the post-war period.
Between 1990 and 1992, the unemployment rate in the former Metropolitan Toronto almost tripled, increasing from 4.3 per
cent to over 12 per cent. For the first time, this rate exceeded the national average, and consistently tracked higher than the
surrounding regions (see chart 1).
Social assistance caseloads grew significantly in response to these economic changes. Between 1989 and 1991, new social
assistance cases in the former Metropolitan Toronto increased from 5,500 to almost 12,000 per month in 1991. In the same
period, the caseload more than doubled, from 38,000 to 87,000 cases. By 1993, the caseload had reached 120,000, peaking
at 126,500 in March 1994 (see Chart 2). The extended rise in the caseload reflected the length and depth of the recession in
Toronto, and its after effects.
Substantial restrictions to the federal Unemployment Insurance (UI) program through the early 1990's also affected
caseload growth, as increasing numbers of unemployed workers found they no longer qualified for benefits, or exhausted
benefits before they found employment. For example, in 1988 UI claimants equalled nearly 70 percent of the total
unemployed population in the GTA versus less than 40 percent in 1996. Evidence suggests the introduction of the reformed
Employment Insurance program in 1996 has further widened this gap.
It should also be noted that the caseload became increasingly ethno racially diverse during this period, reflecting the overall
diversity of the City's population and the increasing proportion of newcomers from non-traditional sources. There was also
a substantial increase in the proportion of clients who received their highest level of education outside of Canada.
However, social assistance caseloads have fallen dramatically in Toronto over the past five years. From its peak in March
1994, the City's caseload fell to just over 71,300 cases in April of 1999, a decline of more than 55,000 cases or 44 percent.
From June 1995, the caseload declined continuously until April 1999 with the exception of two brief periods (see chart 3).
Although the overall provincial caseload has declined at a rate similar to the City's over this period, caseloads have fallen
by significantly smaller percentages in other large Ontario cities.
By early 1999, the City's caseload had stabilized, fluctuating between 71,000 and 73,000 cases. Recently, due to the
transfer of responsibility for single parent cases to the City from the Province, about which more will be said below, the
caseload has increased, reaching 75,000 cases in July.
Factors Contributing to Caseload Decline:
The City's caseload declined as the result of a combination of factors. Substantial changes to the social assistance system
implemented by the Province have clearly played a role. These changes include the 21.6 percent reduction in social
assistance rates implemented in October 1995, a number of other changes to regulations and policies which restricted
eligibility, and finally, the introduction of the Ontario Works program, culminating in the passage of the new Ontario
Works Act in late 1997. New program features introduced under O.W. have increased the obligations for those receiving
benefits under O.W.
Changes to other government programs have also affected the caseload. Changes to the Immigration Act in 1996 reduced
the number of sponsored immigrants applying for assistance. Also beginning in the fall of 1996, sole support parents and
two adult families were required to access both educational costs and personal living allowances through the Ontario
Student Assistance Program, a change which made a sizable number of families ineligible to receive social assistance.
Of greater importance is the sustained improvement in the GTA's economic environment. Beginning in 1995, there were
rapid increases in the number of people employed in the Greater Toronto Area (GTA), although this growth was
concentrated almost exclusively in the outer GTA regions (see chart 4). In both 1997 and 1998, job growth in the GTA has
been very strong, at more than 80,000 net new jobs per year. Since Toronto is part of the larger GTA labour market, the
improving employment situation clearly contributed to the decline in the City's caseload.
Increases in employment in the City itself did not occur until mid 1996. However, since then, there has been a steady
increase in the number of people employed, and a substantial decline in the unemployment rate, from 9.9 percent in April
1996 to 7.2 percent in May 1999. Nonetheless, unemployment rates in the GTA and province, at 6.7 and 7.0 percent
respectively, are still lower than the City's. Total employment in the City has also not returned to its pre-recession peak.
Clients Leaving Social Assistance:
In March 1997, the Division reported to Metro Council on the findings from a major survey of clients exiting social
assistance (Human Services Committee, Report 4, Clause 1). The purpose of the survey was to better understand why
people were leaving assistance, in order to plan for the implementation of O.W. Over 1000 clients were contacted,
providing a representative sample of all people exiting the system for two three month periods in 1995 and 1996
respectively. Approximately 43 percent of clients left assistance to take jobs, while another 27 percent left to receive some
other form of government benefit. Other left for a wide range of different reasons.
Overall, two clear findings emerged:
(a) higher levels of education are related to success in finding and keeping employment. While this finding was not
unexpected, it does suggest, that in a buyers labour market, where skill levels required to obtain better jobs are increasing,
programs designed to enable people to remain in the workforce will have to invest in suitable skill and educational
upgrading; and
(b)the majority of people obtained jobs in predominately low skilled areas, such as retail sales and service, which have
well documented high turnover rates and low pay levels. Such jobs are particularly vulnerable to downturns in the
economy.
Historical Patterns and Future Trends:
Although the caseload has declined substantially in the past four years, it remains significantly higher than before the
recession began in 1989. This follows the historical pattern evident since the early 1970's, where recessions result in large
increases in unemployment rates and social assistance caseloads which, despite subsequent periods of strong job growth,
do not return to pre-recession levels. In effect, each recession has created a residual caseload, comprised of workers who
have been displaced due to the ongoing restructuring of labour markets. In Toronto, this pattern has intensified over the
past three decades, with the combination of a severe recession, and economic and technological restructuring, leading to
massive permanent job losses in the early 1990's.
In the near term, economic forecasts project continuing strong growth rates across Canada, averaging about 3.5 percent in
1999, and just under 3.0 percent in 2000. Ontario is expected to achieve nearly 5 percent growth in 1999, and continue to
lead the country in 2000. On the job creation front, according to recent forecasts made by the Toronto Dominion Bank,
95,000 new jobs will be created in the Toronto region this year, with a still healthy 50,000 jobs being created in 2000. It is
expected that the Toronto region will account for almost 50 percent of the jobs created in Ontario in 1999-2000, with the
unemployment rate falling to less than 6 percent.
Reflecting the impact of the economic changes that have occurred this decade, there have also been unprecedented changes
in the make-up and characteristics of Toronto's social assistance caseload. In fact, as will be discussed below, the process
of caseload decline itself has dramatically altered the caseload over the past four years. Given the changing nature of the
City's caseload, favourable overall economic conditions alone will not automatically guarantee further large decreases in
the number of clients receiving social assistance.
II.Changes in the Social Assistance Caseload:
Toronto's social assistance caseload has changed in two fundamental ways through the 1990's:
(1)the proportion of families on social assistance has increased rapidly to the point where they represent the majority of
cases now receiving assistance (58 percent in July 1999) versus merely 26 percent of total cases in 1991; and
(2)within the context of a substantial overall increase in the length of time people remain on social assistance, there has
been the emergence of a long term and a short term caseload.
Both of these changes are the result of a variety of factors which will be identified below. They also have very significant
implications for the delivery of Ontario Works within Toronto, notably for the continued evolution of TSS' service
delivery approaches and models.
A.Caseload Mix - Single People versus Families:
Decline in the Number of Single Persons Receiving Assistance:
As a result of the recession in the early 1990's, single adults who were considered employable were primarily responsible
for the substantial growth in the caseload early in the decade. There was also a gradual but much slower growth in the
number of families coming onto assistance (See chart 5). The increase in single parent cases on the City's caseload
occurred initially due to changes in Provincial policy.
Ultimately, whether the caseload grows or declines within a specific period is determined by the respective rates at which
new cases enter the social assistance system compared to the rate at which cases leave the system. A previous report to the
former Metro Council, prepared by the Community Services Department in May 1996 (Human Services Committee,
Report 10, Clause 7), noted that the substantial fall in the caseload which occurred between mid 1995 and the end of 1996
resulted from a dramatic decline in the rate at which new cases were entering the system, rather than an increase in the
number of cases exiting.
What is notable is that caseload decline over this period was primarily driven by the number of single people both entering
and exiting the caseload. The growth in the number of single people entering the system ceased in late 1992, while the
growth in families continued well into 1995. Beginning in 1995, single people began to exit social assistance rapidly. For
example, of the nearly 16,551 cases that left the system between June and December 1995, the period during which the
caseload fell most rapidly, over 10,818 cases, or 65 percent., were single employables. During the same period, the number
of new singles entering the system fell by 31 percent.
In conjunction with an increase in the availability of low paying jobs, changes to social assistance rates implemented by the
province in October 1995 contributed to the decline in the number of single adults on the caseload over the past several
years. This reduction in benefits had the effect of widening the gap between what even a minimum wage job paid and
social assistance benefits, thereby making employment opportunities more attractive. Single adults, because they do not
support dependants and are typically more mobile than families, also have greater flexibility to pursue lower paying jobs.
The New Family Caseload:
The end result of the pattern of caseload decline discussed above is displayed in chart 6. In January 1995, single persons
represented nearly 60 percent of total cases. Since then, the proportion has steadily declined. In late 1997, for the first time,
the proportion of family cases exceeded 50 percent of the caseload. By July 1999, families represented over 58 percent of
the total caseload, while families with children equalled over 54 percent of the total. Single persons represented only 42
percent of the caseload.
By July 1999, the number of single people on the caseload had returned to levels last seen in the early 1990's, at the onset
of the recession. In direct contrast, the number of families in receipt of assistance in July 1999 was nearly four times higher
than at the beginning of the decade.
The increase in the proportion of families in receipt of O.W., especially those with children, has occurred because the
number of single parents receiving social assistance has remained fairly stable over the past four years, despite a 40 percent
plus decline in the overall caseload . Whereas in 1991 single parents comprised merely six percent of the caseload, by late
1994 the proportion had increased to 20 percent (see chart 6). In July 1999, nearly 40 percent of all cases on social
assistance were led by single parents, more than 95 percent of whom are female, and single parents constituted more than
68 percent of all families with children. These proportions will continue to increase as the remaining 4,000-5,000 single
parent cases are transferred from the Provincial system to the City over the next several months.
The increase in single parent cases is consistent with overall demographic trends:
(a)while single parents represented only 19 percent of all families in Toronto in 1996, between 1991 and 1996, according
to Statistics Canada data, single parent families increased by 23 percent, representing over 50 percent of the growth of new
families with children;
(b)In 1996, Toronto was home to over 60 percent of all single parent families in the GTA versus its 50 percent share of
total families; and
(c)Female single parents have among the highest incidences of poverty of any demographic group, with over 60 percent
of this population falling below Statistics Canada's low income cut-off lines in 1996.
Children on Social Assistance:
Directly related to large increase in the proportion of families on the caseload is the growth in the total number of children
in receipt of social assistance (see chart 5). In July 1999, there were nearly 87,000 children under 18 in receipt of assistance
versus less than 31,000 in the same month in 1991, although the overall caseload was 14 percent higher in 1991. In fact,
there were as many children under four years old (approximately 31,000) receiving O.W. this July as there were children
under 18 in 1991. Moreover, while the overall caseload declined by over 40 percent since early 1995, the total number of
children in receipt of assistance has increased by approximately 17 percent.
Reflecting the changing proportion of families versus single adults, and the increasing number of children, in receipt of
assistance, it is also not surprising that the total number of people receiving assistance fell by 33 percent, significantly less
than the rate of overall caseload decline.
B.Length of Time on Assistance:
One dominant trend over the past decade is the continued growth in the average time a case is in receipt of assistance. Over
a five year period, 1991 to 1995, the average number of months that a single person or family received assistance increased
from about 7 to 18 months. Since that time, the average length of stay has further increased to approximately 25 months.
Viewed over the past five years, changes in the average length of stay across the entire caseload display a clear pattern (see
chart 7). There is a consistent short term caseload, representing approximately 15 percent of all cases, which receive
benefits for less than four months. At the same time, there is a rapidly emerging long term caseload. Whereas only 12
percent of all cases were in receipt of assistance for more than three years in early 1995, by mid 1999, approximately 27
percent (or nearly 20,000 cases) of total cases had been on social assistance for more than three years. This represents a
pivotal change in Toronto's caseload.
This change is directly related to another fundamental shift in the City's caseload discussed above: the rapid increase in the
proportion of families versus singles. 68 percent of the cases on assistance for more than three years are families with
children, with over two thirds of this group comprised of single parents. The vast majority of these cases are also
employable, whereas 38 percent of single persons on assistance for more than three years are categorized as ill or
temporarily disabled.
Also of interest is the change in the length of stay for different case types. Currently, the average length of stay for single
adults is about 20 months versus 8 months in 1991. This compares with an average of approximately 27 months for single
parent families (versus 5 months in 1991) and nearly 35 months for two parent families with children (versus just over 8
months in 1991). Thus, not only has the length of stay increased for all types of cases, the gap between the time singles are
staying on the caseload versus families with children is also steadily increasing. Chart 8 illustrates both the rapid growth in
average length of stay between 1991 and 1999, and the increasing discrepancy between the lengths of stay for different case
types.
Rapid increases in the average length of stay at a time when caseloads are decreasing steadily may seem incongruous. In
fact, this trend indicates that a substantial percentage of the cases that are leaving the system have been in receipt of
benefits for a relatively short time. In April 1999, for example, over 27 percent of the cases leaving assistance had received
benefits for less than four months, while 60 percent had received benefits for less than one year. These findings are
indicative of trends over the past several years, and apply particularly to single persons, who tend to constitute a "last
on-first off" group of recipients. Ultimately, the result is that there is significant caseload turnover on an annual basis, with
those cases on assistance the shortest length of time, particularly single persons, also tending to be the first ones to leave.
C.Caseload Transfer:
As a result of changes to the social assistance system enacted by the Province in 1997 with the passage of the Social
Assistance Reform Act, all single parent cases formerly managed by the Ministry of Community and Social Services are
being transferred to municipal O.W. delivery agents. In Toronto, as reported to City Council in the Department's March 5
report entitled "Transfer of Provincial Responsibilities to Social Services and Children's Services Divisions", the transfer
process began in May 1999 and will proceed over the summer. Overall, approximately 11,000 single parent cases are
expected to be transferred. The overall effect will be to even more dramatically increase the percentage of single family
cases in receipt of assistance, to over 43 percent of total cases. At the same time, the number of dependant children under
18 will also increase substantially, exceeding 90,000.
D.Summary:
A new social assistance caseload is emerging in Toronto, shaped by the pattern of caseload decline in the second half of
this decade. While single persons have rapidly moved off of assistance, or no longer seek assistance, families with children
have had a much more difficult time becoming fully independent. Not only must they find higher paying jobs, in order to
survive in an expensive city like Toronto, in many cases they must also find accessible and affordable child care. Indeed,
this and other supports must be available to enable them to look for work in the first place. This is particularly true for
single parents. However, it should be noted that a steadily increasing proportion of families with children do in fact have
employment earnings (28 percent in July 1999 versus 22 four years earlier), reflecting their desire and ability to work, but
also their difficulty in finding stable full-time jobs which pay wages sufficient to enable them to exit social assistance
completely.
The most notable impacts of the changes described above can be summarized as follows:
(a)The rapid increase in the number of families, particularly single parent families, on O.W., and the consequent increase
in the number of children in receipt of benefits, will clearly require the Division to make a much wider and more extensive
range of service supports available. Based on the Division's research and delivery experience, families will need a
combination of supports, most notably child care, but also transportation, job referrals, educational upgrading, employment
experience, and job preparation courses. They will also require a larger investment of staff time and resources, from both
Toronto Social Services and agencies within the community.
(b)After the caseload transfer is completed, it is estimated that over 30 percent of the City's caseload will be long term
cases, in receipt of assistance for more than three years. The substantial majority of these cases will be families. Increased
time on assistance, and increased time out of the workforce, significantly reduces the probability that a family will be able
to become independent without substantial assistance and support from the Division. When combined with other barriers to
employment (lack of English language skills, low levels of education or lack of Canadian work experience), the result is a
group of clients that has been referred to in other jurisdictions as "hard to serve" or "hard to place". Substantial investments
in staff resources and in service supports will again be required to provide the type of "in depth" assistance that many of
these families will need to become independent.
(c)At the same time, there is a sizable group of clients (over 15 percent) who move onto and off of the caseload rapidly.
They will require few supports, and are mainly highly employable.
Taken together, these changes are particularly significant for the delivery of O.W. in Toronto, the fundamental purpose of
which is to assist client obtain work as quickly as possible, and move off of the system. To accommodate this goal, and to
meet the service needs of a caseload which has altered dramatically in the past five years, TSS has recognized that
development of a new service delivery model is crucial. This model must provide more effective screening and assessment
tools at the point of first contact with the client. In this way it will be possible to determine early on whether a client is
likely to remain on assistance for a lengthy period, and require specific interventions, or whether they are highly
employable and likely to move off the caseload quickly.
Conclusion:
A combination of policy and economic factors have led to the creation of a new family based social assistance caseload in
Toronto over the past five years. Moreover, the vast majority of these families have children, the majority of which, in turn,
are led by single parents. At the same time, the overall length of time clients remain on assistance has continued to
increase, but particularly so for families. It is likely these trends will continue for the near future.
These changes have extensive implications for the delivery of O.W. in Toronto. Additional supports and services, as well
as staff time, will be required to help many families with children who have become increasingly detached from the labour
market. It will also be necessary to more effectively target both staff time and supports appropriately, based on client need,
such that the right services are available to the right clients at the right time. Finally, the availability of accessible and
reliable child care supports will be crucial to assisting families participate in the O.W. activities that will prepare them to
re-enter the workforce, to searching for work, and to maintaining jobs.
Contact Name:
Heather MacVicar
General Manager, Social Services Division
392-8952
General Manager, Social Services Division
Commissioner, Community and Neighbourhood Services