$15 an hour bad fiscal policy

The massive minimum wage hike and rollout of the onerous Bill 148 regulations are plain bad policy. They weaken Ontario’s competitiveness and are nothing more than a total capitulation to organized labour special interests by the unpopular Wynne government, desperate to buy as many votes as they can in order to save their sinking ship.

Government claims of wide consultation with stakeholders are laughable. Continuous warnings from small businesses of the negative effects of these cost increases seems to have fallen on deaf ears. A hike of close to nearly 30 per cent in just 18 months will certainly lead to job losses by youth and unskilled workers.

The effects of price floors are economics 101. Many small businesses cannot endure a substantial spike in operating costs in addition to overregulation and out of control hydro prices. They’ll have little choice but to either raise prices, or cut staff or benefits.

Many business owners who employ minimum wage employees find themselves in industries with very elastic demand. Raising prices enough to offset these losses might not be practical. Unfortunately, cutting staff may be their only option.

Overall prices will eventually adjust, offsetting any marginal benefit of expanding minimum wage, and sooner or later the same proponents will be calling for another hike. What’s next? $20? $25?

Sadly, the government chose to put the burden of this hike squarely on the shoulders of hardworking business owners, who are operating in an environment where poor government policy has made costs soar. Perhaps the government could have increased the level of income exempt from income tax or lowered income taxes altogether, but I suspect that might hurt their coffers and we all know the Wynne Liberals need every last dollar they can get. Scott Fenn, Tecumseh