A fair minimum wage for Albertans
BOOST WILL EASE FINANCIAL STRESS FOR LOW-WAGE EARNERS
On Oct. 1, Alberta’s minimum wage will increase to $15 an hour. This will mean a pay bump for the roughly 250,000 Albertans (10 per cent of all workers) who currently make less than that. There are a lot of questions and misconceptions about what a fair minimum wage will mean for Alberta, and I am happy to take some time to address them here.
First, minimum wage was never meant to be a baseline starting point for all jobs. It is the lowest amount employers can legally pay their employees, but many Albertans find themselves sitting at that lowest amount for years, decades, or their entire working lives. Someone who works fulltime and makes minimum wage in Alberta is very likely to fall under the Low-Income Cutoff, casually known as the “poverty line.” There is no reason why someone who works 35 hours a week should be in poverty. No reason why they should have to stop at the food bank on their way home from work just to feed their family. When a low-wage earner relies on social programs just to get through the month, their employer is essentially being subsidized by tax and philanthropy dollars that could be helping others.
Next, let’s talk about who makes minimum wage. Many of us have an idea that most minimum-wage earners are young students at their part-time or seasonal job, earning money for fun extras. That might have been the case a generation or two ago, but today, only a quarter are students, and about half of all minimum-wage earners are over 25 years old. When we look at who does make minimum wage we see that most are women (63 per cent), many are parents (37 per cent), and most are working full-time (53 per cent) permanent (76 per cent) jobs. Raising minimum wage will help tens of thousands of households with children be able to meet their basic costs. It will help them live without the constant stress of imminent financial catastrophe. It will make the ground a little more solid under those children’s feet.
And what about those minimum-wage earners who are young, or who are students? They also deserve to be paid fairly for their work, and when they are earning more they can take stress off their families. If you’ve ever had to pay for a teenager’s hockey equipment, or help with a post-secondary student’s tuition, you know that life is expensive for young people. When they are able to earn a little more, that’s a little less that has to come out of their parents’ pockets.
We phased in minimum-wage increases over three years in order to ensure employers had time to plan and adjust. Furthermore, we have assisted employers in other ways. We reduced small business tax rates from three per cent to two per cent, saving small businesses $195 million in 2018-19. We reinstated the Summer Temporary Employment Program, which subsidizes the wages of summer staff and allows students to get valuable work experience. We’ve introduced the Capital Investment Tax Credit, created the ministry of Economic Development and Trade, and provided more capital to ATB Financial and Alberta Enterprise, all to stimulate investment in Alberta businesses.
It is working. Between July 2017 and July 2018, full-time employment has increased by 36,300, and overall employment has increased by 39,600. The number of unemployed Albertans decreased by 26,800. This is despite a minimum wage increase in October 2016 and October 2017. Skeptics told us the sky would fall if we increased minimum wage, but instead employment has increased in the sectors that employ the most minimum-wage workers.
So let’s end by talking about what happens when a low-wage earner does make a fair wage. While high-wage earners may sock their money away or spend it internationally, low-wage earners spend money locally. More money in a single-parent’s pocket means more money spend in local grocery stores, clothing stores, and maybe they can buy some skates for the kids, too. More money in a student’s pocket means they can afford to study this weekend instead of picking up an extra shift. These benefits spread through our local economy, and make life better for all families.
When I was elected in 2015, Alberta was tied for the lowest minimum wage in the country while the richest Albertans got further and further ahead. That wasn’t right then and it isn’t right now. There’s more to do to make sure our economic recovery hits every kitchen table but a fair minimum wage is a big step in the right direction.