MEDDLING WITH WAGES
At a time when many small businesses are struggling and joblessness is on the rise, what does the NDP government recommend as a salve: a higher minimum wage that will add further pain to employers and hurt those the measure is intended to benefit.
The commitment to lift the figure to $15 an hour by 2018 plays to the NDP’s base and won’t cost the government a penny — unless you count the taxes that won’t be paid by businesses that can’t survive in an increasingly high-cost model.
“I am pleased that we’re able to work with the business community to help them move forward,” Premier Rachel Notley said recently, noting the NDP has trimmed the small business tax and is introducing a capital investment tax credit.
“But when it comes to the minimum wage, we also believe, particularly that at times like this, it is not appropriate for a single parent to work 50 or 60 hours a week and have to stop at the food bank two or three times every week to feed their family.”
Notley’s hypothetical example of a single mom or dad working 60 hours a week — which would generate $672 at today’s minimum wage — is compelling, but not very common. Less than two per cent of Albertans work for minimum wage, the lowest percentage in Canada. Of those that do, many are youth getting a start in the labour force by working part time while living at home.
The minimum wage was never intended to be something a single person could support a family on. In the case of youth and others working at that rate, they’re likely to get a boost as they learn the ropes and become increasingly valuable to the business. Their experience and skills, if unrewarded, are certain to be recognized by employers’ competitors or people looking for similar skills.
One of the consequences of a higher minimum wage is that employers are encouraged to hire more seasoned workers with higher productivity, leaving inexperienced applicants on the sidelines. Raising the figure to $15 an hour would also create pressure to hike the pay of similarly paid employees — further imperilling the viability of small businesses and creating greater incentive to trim costs by shedding jobs and cutting hours.
Canadians are helping low-income families through generous supports from both the federal and provincial governments. More should be done to lift people out of poverty, of course, but it should be achieved with programs that boost their skills and increase their employability. It should not be done by clumsy government meddling.