Living Wage proposal deserves another look
Staff report doesn’t reflect true cost for City of Regina, say Paul Gingrich, Brian Banks and Simon Enoch.
As authors of the 2016 Regina Living Wage calculation, we were dismayed by the City of Regina’s decision to not adopt a Living Wage (LW) for municipal employees and contractors.
Much of the rationale for the city’s decision hinged on the administration report that cited the cost of adopting the living wage at $1.1 million.
Certainly, there are costs associated with becoming a Living Wage employer, but there are also innumerable benefits to ensuring your workforce has the income to afford essential necessities like child care, supplemental health care and education. This has been shown time and again by the hundreds of living wage communities and employers across Canada and the United States.
However, as the debate over the LW for the City of Regina seemed to be so preoccupied with cost, it is all the more concerning that the city administration’s report appears to have miscalculated the cost of the LW both to city councillors and to the public at large.
We stated in our 2016 report that assessed the LW for Regina at $16.95, that we had not incorporated the full impact of the then-newly introduced Canada Child Benefit (CCB).
One of the purposes of the LW calculation is to demonstrate how social policy (subsidized child care, social transfers, etc.) can substantially lower the living wage in an area by reducing the costs of living.
The city should have recalculated the LW for 2018 based on this omission alone.
According to our calculation, if the full CCB benefit had been incorporated, along with the small increase in the Saskatchewan low-income tax credit, the LW for Regina is actually closer to $16 per hour — almost a full dollar less.
According to the city administration report, only a small sub-set of employees make less than this, making the actual wage bill for city employees much less than the $57,000 cited in the report. Moreover, the cost to apply that wage increase to both contractors and service partners would also be drastically reduced. By how much we cannot be certain, as the report doesn’t reveal what sort of methodological assumptions went into their calculations.
For instance, most LW municipalities impose a threshold on contracts that are subject to paying the living wage. In Vancouver, only contracts above $250,000 per year are required to pay a LW. Did the city consider such a threshold in their estimates?
Similarly, other LW municipalities have restrictions on what service partners are required to pay a LW. Did the city consider this in their estimates?
Lastly, the city’s report also makes no attempt to monetize the cost-savings from implementing a living wage. While we recognize these can be difficult to assess, reduced turnover and training costs and increased competitive bidding for contracts due to level wages are all outcomes that other LW municipalities have experienced. How can the city recommend against adopting a living wage without a richer understanding of the costs and benefits we’ve seen in other jurisdictions?
Yet, with all this focus on cost, we can forget what the purpose of a living wage actually is. It is to recognize that workers should receive a wage that is commensurate with what it costs to live in a certain area. The City of Regina could set an example for other employers by acknowledging that current wage rates do not reflect the true cost of living in this city. If the city is at all serious in its public statements regarding poverty and affordability in this city, what better way to demonstrate its leadership than to ensure its own employees are afforded a living wage?
Ultimately, the city administration’s report does not reflect the true cost of a LW for the City of Regina, nor the benefits. We would be more than happy to assist the city in tabulating an up-todate living wage for 2018, in the interest of ensuring that the debate over a living wage for the City of Regina is informed by accurate information.