Minimum wage hike will affect Drumheller businesses ‘big time’
Businesses in Drumheller are bracing for the minimum wage hike in October, saying it will affect their businesses and staff.
Alberta is set for the minimum wage to be raised from $13.60 per hour to $15 per hour on October 1, with a recent report from Public Interest Alberta saying more than 300,000 Albertans, nearly 1 in 6 workers, will have their wages increased. A key promise of the Alberta NDP’s 2015 election platform, Alberta’s minimum wage has risen from $12.20 in October 2016 to $13.60 in 2017, with the coming increase being the last of the party’s promise to raise wages for the province’s lowest paid workers.
Local businesses are preparing for the effects of the upcoming hike and say it will change how they do business.
“It’s going to affect us big time,” says Pizza Hut owner Tony Ibrahim. “When minimum wage goes up, prices of products go up right across the board. So at the end of the day people don’t end up with any disposable income.”
“I’m going to have to cut back hours,” says Sublime Food and Wine owner Dennis Standage, who adds his business will be cutting back lunch services partly due to the wage increase.
A report from the Canadian Federation of Independent Business in mid-August says 85 per cent of over 1,000 small businesses surveyed say they want minimum wages frozen at current levels. The report also said 55 per cent have reduced or eliminated plans to hire new workers and 46 per cent have raised prices.
The report from Public Interest Alberta also says about 77 per cent of those workers are 20 years of age or older, dispelling the “myth that most low wage workers are teenagers living in their parents’ basements.”
“We have gone on too long allowing workers to be paid poverty-level wages,” said the organization's executive director Joel French in a press release.
But Pizza Hut’s Ibrahim says it is not just an employee’s wage which increases, but the increase causes suppliers and others along the chain of business to increase their costs, which gets passed onto owners and, ultimately, onto customers.
“You’re not even breaking even in some cases. But there’s not much you can do about it, you just keep trying to grow your business as much as you can.”
The Mail reached out to a number of other local businesses who declined to comment.