‘I’ve got two months, tops’: COVID-19 has freelancers and small businesses on the ropes

The federal government has announced new supports for those who’ve lost work or income as a result of the pandemic — but critics say it’s not enough.
By Kieran Delamont - Published on Mar 25, 2020
The federal government has announced emergency employment-insurance programs that will support people who have lost work or income as a result of the pandemic.  (iStock.com/Gwengoat)



OTTAWA — Amanda Cockburn is worried about the effects that a multi-week shutdown will have on her business. “I run real-life experiences,” says the founder of the Ottawa-based Freewheeling Craft. “The last few weeks have decimated the events industry for the foreseeable future.” 

Freewheeling Craft sells items from a range of local businesses and artisans at craft markets and pop-up retail shops. She also runs workshops and conferences for local female entrepreneurs. With Ontario in a state of emergency due to COVID-19 — and health officials promoting social distancing — she’s been left scrambling to drum up online business both for herself and for all the small businesses she promotes. She worries most about those other businesses: many are just getting started, she says, and a lot of them won't make it through. 

Cockburn's situation is a familiar one for freelancers and independent contractors, many of whom are seeing their plans and expectations for the work year evaporate. As the province’s economy has slowed to a crawl to suppress the spread of the novel coronavirus, independent contractors across Ontario are facing an unprecedented stress test: surviving a world-historic economic event at a time when the independent workforce is bigger — and more precarious — than it’s ever been.

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Last year, there were upwards of 1.2 million self-employed workers in Ontario, according to Statistics Canada; more than 580,000 of them were unincorporated with no employees. Self-employed workers make up over 16 per cent of the economy, and that number is increasing: self-employment has grown by 7 per cent since 2018 — more than double the 2.9 per cent growth in the overall workforce. The freelance workforce increased nearly 13 per cent. 

“What's wrong with this structure of the labour market that we have so many people … who are so precariously employed that they really can't weather this storm?” says Sheila Block, senior economist at the Canadian Centre for Policy Alternatives. As the workforce has become more independent, she adds, it's also grown more vulnerable to volatility, and social assistance hasn’t kept up: “How can we provide more things collectively that used to be provided by individual employers?”

Last week, the Ontario government announced that it would make sweeping amendments to the Employment Standards Act designed to protect employees from being fired for taking time off during the pandemic. But “the ESA does not apply to independent contractors or self-employed individuals who are in business for themselves,” explains Janet Deline, a spokesperson for the Ministry of Labour. 

“It’s very clear that the [provincial] government’s announcement, first of all, did not provide any coverage — not only to people who are working in the so-called gig economy, but also to anyone who is self-employed,” says Block. “It provides no income protection and no coverage for people who aren’t, under the [Employment Standards Act], defined as employees.”

Even in the best of times, Ontario’s labour laws draw complaints from freelance and self-employed workers. The rules, they say, push them into taking low-paying or unsafe jobs. And during a viral pandemic, they’re financially incentivized to keep working: their labour concerns become everyone else’s health concerns.

On social media, writers, photographers, designers, and small-business owners facing income uncertainty are asking for financial assistance, looking for remote gigs, selling art, and generally fretting about the future. Different levels of government are rushing to create social-security programs that will accommodate freelancers and independent contractors. The federal government, for example, has announced emergency employment-insurance programs — the Canada Emergency Relief Benefit, the details of which were announced on March 25 — that will provide $2,000 per month for four months for anyone who has lost work or income as a result of the pandemic. 
The federal government's plan may be a workable stopgap solution for some, but many businesses are looking for more comprehensive forms of support. “I will look into applying, but $2,000 doesn’t even cover half my rent, let alone any other expenses,” says Anna Luciano, owner of Lash & Lipstick Beauty Bar, in Toronto. “If my landlord doesn't work with me, I've got two months, tops.” 

“I haven’t heard anyone say that sounds good,” Cockburn says, adding that “EI only goes so far.” In Ottawa, the owners of Supply & Demand, a popular restaurant, has called on the federal government to step in to support tenants with their rent payments; anti-poverty advocates are pushing for a national rent freeze.  

Cockburn would like to see some level of government introduce small low-interest loans or grants to help independent businesses stabilize, as the sector will have to try to recover — or even rebuild — in the context of a bruised and battered economy. Especially for craft makers and creative workers, she says, “$10,000 in their hands could be life-changing.”

Not all members of the independent workforce are concerned about the slowdown — at least not yet. “I’ve saved all year for a slow winter, and it was a decent one, so I will weather this storm,” says Ottawa-based photographer Nicolai Gregory. “I’m cooking way more, drinking less, working out, reading more — it's resetting me in a way.” Gregory suggests that freelancers are uniquely prepared for the current economic circumstances. “Freelance is always about figuring out how to survive when there’s no work,” he says. “I think we are more trained for this kind of situation than any other line of work.”

But he knows there will be challenges. “Freelancers will be the first to feel the impacts of a recession,” says Gregory. “I think a lot of freelancers will [be okay]; it’s the paycheque-to-paycheque people that are most affected.” 

Block sees this as an opportunity to rethink the way governments protect independent labour. “We really need to have a longer-term conversation,” she says. “How did we get here, in such a rich province and country, that people are so often operating without a net?” 

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