Calm Before the Storm: The Great Recession’s Impact on Homelessness

Recessions are much more than a numerical change in Gross Domestic Product (GDP) or another term for high unemployment. The full impact of a recession takes many years to completely unfold and a recession’s impact on households and communities is neither straightforward nor immediate. The homeless population of a given jurisdiction is one of the last groups to see a change after the onset of a recession, making homelessness the opposite of the proverbial canary in the mine shaft. To be sure, if a drop in GDP is one of the first changes brought about by a recession, an increase in the number of homeless persons is one of the last. Indeed, individuals resort to sleeping in a homeless shelter as an absolute last resort. There is therefore a lag effect during a recession―a delay of several years between the onset of the recession and the increase in the homeless population. The purpose of this essay is to explain how recessions have traditionally impacted homelessness. It will then discuss the current recession with a focus on Toronto, Canada. Toronto is the focus in part because, with a population of roughly 2.6 million people (5.5 million in the Greater Toronto Area), it is Canada’s largest city and sixth largest government (City of Toronto, 2009b). It is also the focus because the present writer worked in that city for 10 years doing front-line work with homeless persons (principally as a mental health outreach worker). The essay will discuss Canada’s policy responses to the current recession and offer a policy recommendation. Section II of this essay looks at the historical impact of recessions on homelessness. Section III looks at the current recession—in particular, the context in which it is unfolding, the impact it has already had at the ground level, and the “lag effect” that typically occurs during a recession. Section IV offers a brief assessment of the policy responses of both the federal and provincial governments respectively. Section V provides a policy recommendation and the last section concludes.

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