Minimum wage war of words rages on
Everything the provincial government was warned about regarding the minimum wage increase has happened, says Julie Kwiecinski.
“It’s become reality,” said the director of provincial affairs for the Canadian Federation of Independent Business (CFIB).
“Everything that CFIB talked about in the summer and over the last several months is now a reality. You’re seeing it … You’re seeing automation, higher prices, less staff.
“The doom and gloom is true,” she said.
Ontario Federation of Labour president Chris Buckley is tired of such remarks.
Buckley told The Standard he’s tired of hearing the CFIB “trying to convince people that the sky is going to fall and that it’s going to be catastrophic across Ontario.”
“It’s nothing short of fear mongering,” he said.
Kwiecinski was a guest speaker Monday at a conference held at the Embassy Suites Hotel in Niagara Falls for Pro Fleet Care, a Burlington-based franchise.
She said the government was warned that the plans would lead to job losses, reduced hours and other efforts by business owners to bring down costs. She said financial analysts predicted 40,000 to 80,000 job losses in Ontario, primarily among inexperienced workers.
Changes to the province’s labour laws were approved last November, including a 21 per cent increase in minimum wage, raising it to $14 an hour at the start of this year from $11.60, with an additional $1 increase arriving at the start of 2019.
Kwiecinski believes it was a big mistake.
“The government turned a blind eye,” Kwiecinski said. “Pure and simple, it’s politics. It’s about getting re-elected. It’s not about helping the low-wage earners.”
Even minimum-wage earners themselves might be adversely effected by the increase, she said.
“How are you helping the lowwage earner when their job has been cut, their hours have been cut and they’re paying higher prices?”
Buckley said in an interview that the wage increase is helping lift 1.5 million Ontario workers out of poverty — “something we should all be trying to achieve here in the province on Ontario.”
“The labour movement has been pushing the government for years to increase to increase the minimum wage across Ontario,” he said.
“This will also generate over $5 billion annually in spending power in the Ontario economy. I would tell people who were trying to spread doom and gloom that they should take a few steps back, take a deep breath and allow us to build the Ontario we want,” Buckley said.
Kwiecinski told her audience at the conference that employers are also paying more for employment insurance as well as other increasing expenses.
“Small businesses are being tsunamied with all of this,” she said.
Ontario Federation of Labour executive director Rob Halpin said “small businesses are going to feel a pinch, perhaps.”
“If your business model is predicated on keeping your employees on poverty wages, then perhaps it’s time they rethink their business model.”
Kwiecinski said CFIB, which represents more than 109,000 businesses across Canada including 42,000 in Ontario, surveyed members Dec. 7 to 19 asking them about changes they would be making to prepare for the increase.
Of the 2,906 responses to the survey, she said, 54 per cent indicated they would reduce or eliminate plans to hire new staff, 51 per cent planned to raise prices, 44 per cent would delay expansion plans, 31 per cent would reduce staff hours, and 28 per cent planned to lay off staff.
“Everybody is going to be affected. When prices go up, we all pay the higher cost,” Kwiecinski said.
She said promised provincial tax breaks for businesses are not enough to offset the increases. And only businesses that make a profit at the end of the year will be able to take advantage of that tax break, and the increasing costs are making it that much harder to do so, she added.
“All indications are showing that it’s not looking very good.” abenner@postmedia.com