Report shows significant earnings gap for former foster children
OTTAWA, April 7, 2014 /CNW/ - Improving support for children in foster care would increase their lifetime earnings by hundreds of thousands of dollars, and save governments in social assistance payments and spending on other public services, according to a new Conference Board of Canada report released today.
The report, Success For All: Investing in the Future of Canadian Children in Care, estimates that former foster children will earn about $326,000 less income over their lifespan compared with children not involved in the child welfare system in Canada. This disparity is largely due to less education -- primarily lower levels of high-school graduation. Over a 10 year period, the cost to the economy of not changing this situation could total an estimated $8 billion through lost productivity.
- Most youth leaving the child welfare system fail to graduate from high school, and many live with poorly treated mental health problems.
- A child exiting the child welfare system at the age of 19 will earn about $326,000 less income over his or her lifespan, compared with the average Canadian.
- The number of children in care in Canada, relative to its population, is far higher than in the U.S. and the gap has widened over time.
In addition, as a consequence of higher rates of unemployment and lower earnings than the national average, governments in Canada make higher social assistance payments and collect lower tax revenues, totaling a cumulative $126,000 per former foster child. If governments were to invest that money in initiatives to help improve the education and mental health of children in care, the long term social and economic benefits could ultimately outweigh that initial cost.
"There is a compelling humanitarian and economic case for tackling this issue. We know that most youth leaving the child welfare system fail to graduate from high school, and many live with poorly treated mental health problems," said Louis Thériault, Executive Director, Economic Initiatives.
"While these issues have been identified in the past, we've now been able to pinpoint the actual financial costs. Taking on these issues not only has the potential to benefit the overall Canadian economy; even more importantly, many foster children could have a better chance at participating more fully in society."
A report by the Ontario Association of Children's Aid Societies, for example, found that only 44 per cent of former foster children graduate from high school compared with 81 per cent for the general population. Former foster children also enroll in post-secondary institutions at around half the rate of the general population. In addition, children in care have a much greater prevalence of mental health problems.
Success For All: Investing in the Future of Canadian Children in Care identifies the serious economic ramifications of not tackling these problem and suggests that governments, businesses, and the general public all have a role to play in helping children in foster care lead more productive lives.
Currently, Canada's welfare system is fragmented. One solution proposed is to undertake a coordinated effort among provinces, led by the federal government. Governments could help implement a comprehensive and cohesive strategy, including targeted investments in improving education and mental health. In addition, there is a need for comparable and consistent national data on children both while in care and after they leave the system. This would also require the cooperation of all levels of government.
Businesses could facilitate the integration of former foster children into the labour market by offering children in care greater opportunities for skills training and employment. This could be achieved by working with child welfare agencies or through public-private partnerships.
The general public could play a role in helping children in foster care by being aware of the special needs of children in care, support ideas to improve their circumstances, and generally assist in integrating foster children into the community.
Success For All: Investing in the Future of Canadian Children in Care is publically available from our e-Library.
SOURCE: Conference Board of Canada
For further information:
Yvonne Squires, Media Relations, Tel.: 613- 526-3090 ext. 221