6.0 Income Composition

Although activity in major elements of the Provincial fishing industry has been halted, other parts of this Report clearly reveal that the industry as a whole has been dynamic, undergoing extensive structural change since the moratorium was called. Recognition and knowledge of the evolution of the industry, as well as the fact that it has continued to provide employment for many affected by the fisheries closures, is integral to understanding and using the data provided (see Section 5.0 for details).

While all clients are eligible for the income support feature of TAGS, many have continued to participate in components of the industry that have remained active and that have grown since the moratoria were established. Some have also participated in non-fisheries labour markets. The income earned from the combination of fisheries and non-fisheries earnings opportunities has enabled many to qualify for UI/EI and thus rely upon TAGS primarily as a means to supplement the income earned. For clients who have been unable to secure market income, the program provides much needed income support.
       

The extent to which currently eligible TAGS clients(1) participated in labour market activities in 1996 is reflected in the diagram. It shows that only 28 percent of those eligible to receive benefits actually received TAGS income only; the remaining 72 percent of clients had some employment income and/or UI/EI in addition to benefits from TAGS. Almost 26 percent of TAGS clients managed to generate some market earnings in addition to their TAGS income.(2) Most of this group, however, were not employed for a sufficient time period, or did not earn adequate income, to qualify for UI/EI and thus relied upon TAGS for a large portion of their total annual income. A small percentage would not have received UI/EI benefits because they worked all year or for a variety of other reasons. The largest share of those who had market earnings (46 percent of the total number of clients) found sufficient employment to qualify for UI/EI benefits. Not surprisingly, workers that received UI/EI benefits in addition to their employment earnings were less dependent on TAGS income than any other group. For instance, for those who had market income but did not receive UI/EI, TAGS income accounted for about 70 percent of total income; for those who had market income as well as UI/EI benefits, TAGS income accounted for only 25 percent of total income(3).

Statistics also reveal that the proportion of workers earning market income has been increasing since 1995. In 1995, about 35 percent of clients relied exclusively on TAGS. This proportion fell during 1996 when about 30 percent of those eligible for benefits relied upon TAGS exclusively. The diagram indicates that increases were seen in the proportion of TAGS clients with TAGS/employment income and TAGS/employment/EI income.

These trends are reflective of activity in the industry during the period from 1992 to 1996. The number of people who have demonstrated the capability to continue to find work and to qualify for UI/EI is notable. This is not to say that everyone who has found employment and qualified for UI/EI has been able to obtain the type or the duration of employment most preferred (for example, work in groundfish harvesting and processing). It does indicate, however, that the industry and other labour markets have been able to partially absorb the impact of the fisheries closures.
       
It is also instructive to observe data relating to the incomes of TAGS clients classified as harvesting and processing workers. The related diagrams show that more harvesting workers had market income than did processing workers. In 1996, about 77 percent of harvesters and 57 percent of processing workers had market income. In 1996, 5,850 of the 7,980 (73 percent) harvesting workers who had market earnings earned all their income within the fishing industry, while about 1,290 persons (16 percent) had earnings, from both inside and outside the fisheries and only 840 (11 percent) recorded incomes solely from non-fisheries sources. These data reveal that a large proportion of TAGS harvesting workers continue to work and that they remain strongly attached to the fishing industry.
       
  The situation differs somewhat for TAGS clients classified as processing workers. While statistics relating to the incomes of processing workers are not as detailed as those for harvesting workers, estimates based upon those that are available indicate that most of the income earned by processing workers also comes from work within the industry. A smaller number of these clients (57 percent) had market earnings as compared to harvesters. These data reflect the continued activity in the fisheries since the moratorium (see Section 5.0) and underline the fact that a large number of TAGS clients have been able to maintain attachment to the industry, in spite of the closures of major stocks in 1992.
   
  A large proportion of TAGS clients work enough to qualify for UI/EI. The adjacent diagram compares market and UI/EI incomes of harvesting and processing workers. It shows the amount of market and EI income received by clients as a percentage of their total income. In 1996, the combined amount of market and EI income for 43 percent of harvesting workers and 38 percent of processing workers was more than half of the total income they received. The diagram also reveals that a considerable number of workers have been able to maintain an active presence in labour markets (mainly fisheries related) and generate a large proportion of their income outside the TAGS program entirely.
       
  The Province's economy and labour force have historically exhibited a strong seasonal component. The seasonality of work in the fisheries is reflective of this and the work and income patterns of people eligible to receive TAGS continue to follow these established patterns. The adjacent diagram shows the seasonal patterns of the labour market activities and earnings of people eligible for TAGS. As the year progresses, the income (fisheries and non-fisheries related) generated from market activity increases significantly, peaking around mid-year - May to August.
       
  In November, most fish harvesting and processing activity winds down and many workers, particularly fish harvesters, file for UI. Coinciding with the resumption of fishing activities in the spring, fish harvesters eligibility for UI ended around mid-May. The graph reflects the very complex and intricate pattern of flows to and from TAGS, the labour market and the UI program. These patterns are similar to what has been observed in the past, with the exception being the presence of TAGS, which now clearly plays an important role in the income received by those affected by a reduced level of fishing activity.

The statistics contained in this report provide a wealth of detail regarding TAGS clients. However they must be interpreted and used with care. They will not fully reflect or reveal the complex industry or labour market dynamics of workers nor the actual well-being of clients. The information presented above shows that, while individuals may experience a loss of TAGS income as they leave the program, all do not, and will not, experience a total loss of income. The situation faced by individuals will vary considerably amongst workers and their families throughout the Province.

The section that follows contains information on, and examines the need for, Social Assistance by those who can no longer collect TAGS benefits. It contains information on the SA incidence of those who have left TAGS earliest in the life of the program. While it remains to be seen how many persons will ultimately require SA, the data have been prepared to at least provide information on what has happened. It is uncertain to what extent the data can be used as an indicator of future SA need at this point in time.



1. Unless noted, figures in this section include only clients who are currently eligible for TAGS.

2. In this section, some income components have been estimated. This has been necessary because all of the information required is not currently available.

3. Estimates of earnings for weeks in which a report card was not returned by a client were made based on the client's available weekly pay data. Earnings for clients who did not return a report card in 1996 are not included.

4. On this diagram, figures exclude those who have exited the program for reasons other than duration exhausted (such as those who accepted Early Retirement or Licence Retirement).