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October 15, 2018 October 15, 2018

Real answers needed in minimum wage debate

Posted on October 10, 2018 by Taber Times

As was mandated by the provincial NDP government, Alberta’s new minimum wage of $15 an hour came into affect at the start of this month amid much sparked discussion on both sides of whether or not it was a good idea for the overall health of a provincial economy.

It is fulfilling a promise the NDP made back in 2015, raising the minimum wage from $10.20 three years ago, in marked stages. The increase means a raise for roughly 300,000 workers around the province, according to Public Interest Alberta’s 2018 Low Wage Report. More than 60 per cent of those who benefit are women, and three quarters of them are 20 years old or older.

Just prior to Monday’s wage shift, Ontario Premier Doug Ford’s government announced it was cancelling its province’s planned minimum wage increase to $15 an hour for 2019 by the previous Liberal government, keeping it at $14 an hour.

Conferring with ‘experts’ on both sides of the spectrums, you will get polar opposite responses. One will say an increased minimum wage will increase the cost of everything, negating the earning power of the wage increase. Another will point to the reality that poor people spend money, while rich people horde it, and in the process of more money for the poor will mean more spending power in the health of an economy.

One would hope there can be consensus on both sides that anyone who works full time for an employer should be afforded the ability to carve out the most modest of livings. It was certainly the creed of then U.S. president Franklin Roosevelt when he made minimum wage law in 1933 south of our border, and said in no uncertain terms that ‘no business which depends for existence on paying less than living wages to its workers has any right to continue in this country.’ It is a motto that should be able to be adhered to in First World North American economies.

The problem with reaching a consensus on the best way achieving a living wage is all the different variables attached to the players in the field. One can feel sympathy for the Mom and Pop coffee shop who employs six people who are struggling to keep the doors open even before the wage increase. Big box store employers whose workers are some of the most highly government subsidized to make ends meet, yet whose employers rake in huge profits every year, not so much. Alberta has the highest average wage of any province in Canada, that wage’s earning power is much different in a large urban centre like Calgary or Edmonton compared to small, rural Alberta. There is the teenager looking to scrape enough money towards a car while another middle-aged person has been unexpectedly laid off and has a mortgage they cannot default on.

Finding a one-size-fits-all solution to ending poverty is difficult because no two economies are the same as showcased in Alberta which goes through boom-and-bust cycles being so closely intertwined with the energy industry.

Each localized economy can be seen as having its own strengths and challenges. Even before talks of raising the minimum wage occurred, Canada was showing the average resident’s paycheque increase was not meeting inflation rates. From May 2015 to May 2016, prices were up 1.7 per cent according to StatsCan, yet weekly earning were up only 0.7 per cent.

Minimum wage hikes, Guaranteed Minimum Income (GMI), income or child tax credits, lower tax rates, — suggestions have been plentiful on how to achieve a living wage and end poverty, but still no general consensus can be reached.

There’s an old adage that numerous people say that low-wage earners need to simply ‘work harder and better themselves.’ If only it were so simple. Let’s say for instance every single Canadian had the time and resources to go to medical school or become an entrepreneur. If everyone owned a business, who would work in them? Despite everyone now being qualified to become a doctor, there is only so much need for doctors in the country. That’s the same as a teacher, plumber, electrician, engineer or whatever. Just as there is a set demand level for those ‘higher-end’ jobs, so too is there for lower-income service jobs, a marketplace that cannot be filled by teenagers and bored housewives alone.

We demand that these positions be filled to help run our economy, yet we are quick to dismiss its workforce as not worthy by some of a basic level of human dignity.

There are certainly no easy answers in the minimum wage/ending poverty debate, but the previous status quo was simply unacceptable.

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