Minimum wage goes up again

Increase goes in effect June 1st to $13.85 per hour

By James Rose

Special to the Pioneer

On Saturday, June 1st, British Columbia’s minimum wage will go up $1.20 (or 9.5 per cent) to $13.85 per hour. John Horgan’s provincial NDP government promised a four-year increase starting in 2018 extending to 2021. By 2021, B.C/’s minimum wage will be $15.20.

In Canada, Alberta currently has the highest minimum wage among provinces and territories at $15. B.C. will be third behind Alberta and then Ontario (where the minimum wage is $14 per hour) come the start of June.

“It’s long overdue that workers in B.C. be on the same pay scale as other provinces like Ontario, Quebec and Alberta,” Premier Horgan said in a press release when last year’s increase took effect.

When Christy Clark became premier in 2011, she increased the minimum wage to $8.75 per hour. By the time her Liberals left office in 2017, B.C.’s minimum wage was $10.85. From 2001 to 2011 the minimum wage went unchanged at $8 under Gordon Campbell’s Liberal government.

Not all are on board with the increased cost base for B.C. business. The Fraser Institute issued a report arguing wage increases end up helping the wrong people because of who actually makes minimum wage.

“They’re predominantly young workers, said Charles Lammam, author of the report. “They’re between the ages of 15 and 24. They’re oftentimes living at home with their parents — in fact, nearly 60 per cent of all minimum wage earners in the province are young workers. They’re typically getting their first experience in the labour market, working part time while they go to school, and that explains largely why this minimum wage is not a good way to target the working poor.”

Prominent provincial labour advocates have expressed their support for the NDP’s plan. Irene Lanzinger, President of the BC Federation of Labour last year told the CBC that the raise and the four-year gradual increase is not too much too soon.

“We live in a very expensive province,” said Ms. Lanzinger. “The poverty line is about $15 an hour. So there are hundreds of thousands of workers who, even if they work full-time, have a wage below the poverty line [and] that’s just not fair.”

For business, what’s key is proper preparation for change.

“Predictability and certainty are what’s on our member’s minds,” said BC Chamber of Commerce President and CEO Val Litwin. “While front-loading the minimum-wage increase will cause challenges for some businesses, the four-year timeline, with projected increases, will help businesses plan and incorporate those costs into their budgets.”

Former Invermere town councillor Justin Atterbury owns several small businesses in the Columbia Valley with dozens of employees. While Mr. Atterbury agrees that it is important to increase employee wage to match inflation, by the same token he doesn’t see it as a magic bullet solution.

“Most local businesses in general operate with net margins between 6 per cent and 10 per cent. If a line item on my income statement goes up by at least 6 per cent, at that point I pass the increase onto my customers.”

One of Mr. Atterbury’s businesses, which he co-owns, is the Station Neighbourhood Pub. Each item on the pub’s menu saw an increase by roughly $1 this spring.

Although many businesses in the Columbia Valley already pay employees above minimum wage, the number serves as a benchmark; a change to the low end of the pay spectrum can have ripples on other pay brackets. As to whether increasing the minimum wage will result in a more affordable, better standard of living in the Columbia Valley, Mr. Atterbury thinks it’s too soon to tell.

“It’s like a social experiment, and I think we won’t be able to see the results until enough data is produced after the wage increases end in 2021,” he said.

The Columbia Valley has a calculated living wage; this is not he same as the minimum wage, but is a number that reflects what earners in a family need to bring home based on the actual costs of living in a specific community.

“The living wage calculation is based on a two-parent family with two children – the most common family unit in B.C. – and each parent working full-time,” said Columbia Valley’s economic development officer Ryan Watmough. “In the Columbia Valley we have a fairly tight labour market which means most jobs pay higher here than in other jurisdictions that would otherwise pay the minimum wage.”

In March 2018, the living wage in the Columbia Valley was determined to be $18.25 based on 2017 data. For 2019, living wage figures across B.C. decreased significantly, according to the new report released Wednesday, May 1st from the Living Wage for Families Campaign. Despite costs increasing steeply for rent and other basic necessities, the cost of living for families with children went down thanks to the provincial government’s new child care policies.

“The B.C. government’s child care investments are a major win for families with children,” said Living Wage for Families Campaign Organizer Halena Seiferling in a statement.

The Columbia Valley 2019 living wage was determined to be $15.92.

The Columbia Valley 2019 living wage was determined to be $15.92.

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