$15 is too low, and three years is too long to wait, for a higher Alberta minimum wage

Posted on June 04, 2015, 10:25 pm
10 mins

PHOTOS: Greetings from Halifax, where a minimum wage almost as low as Alberta’s isn’t half of what a two-earner family needs to live a decent life. Can it be much different in Calgary or Edmonton? Below: Enthusiastic Tweeter Dan Kelly’s Twitter thumbnail; Alberta Finance Minister Joe Ceci.

HALIFAX, N.S.

The biggest problem with the Alberta New Democratic Party government’s plan to raise the minimum wage to $15 an hour over three years is not that it goes too far too fast, as its vociferous and self-interested critics persist in claiming, but that it doesn’t go far enough fast enough.

When I arrived here on the rainy East Coast a few days ago for the biennial convention of the Canadian Federation of Nurses Unions, the Halifax Chronicle Herald was reporting that a person would need to earn $20.10 cents an hour to make a living wage in the Nova Scotia capital.

KellyThis news shouldn’t surprise anyone who’s been paying attention, although it was astonishing to see such a thing under a major headline in a provincial capital city’s daily newspaper – and that’s high credit to the oft-disparaged Chronicle Herald.

The Halifax living wage is almost double the new $10.60-per-hour minimum wage introduced by the Nova Scotia government on April 1, and more than double Alberta’s pathetic and embarrassing $10.20 minimum wage, the lowest in Canada, bequeathed to us by one of the many recent versions of the unlamented Progressive Conservative government.

The report by the Chronicle Herald – which seems to be called the Chronicle News on-line, heaven knows why – was based on a recent study conducted by the Nova Scotia office of the Canadian Centre for Policy Alternatives, which uses the Canadian Living Wage Framework to calculate the amount needed for a family of four with two income earners to live a life with dignity and without deprivation.

CeciIn Halifax according to the Chronicle Herald’s report, close to 50 per cent of working people in the area are earning less than a living wage.

Another astonishing thing about this study was that it was commissioned by United Way Halifax, which seems to have decided it made more sense to use some of its donors’ money to work toward eliminating poverty, instead of just helping us feel good about ameliorating some of its symptoms.

This prompted a nearly hysterical reaction by Dan Kelly, the president and CEO of the Canadian Federation of Independent Business, an Astro-Turf group that purports to represent the interests of small business owners but reliably supports the neoliberal agenda of big business and ultra-conservative ideological groups even when that is not in the interests of small business people, as in its regular attacks on the pensions saved for by public employees.

“Given the United Way’s growing role as a left-wing advocacy group,” Mr. Kelly Tweeted uncharitably, in every sense of the word, “I suggest small firms rethink participation & support charities directly.”

Floating the idea of a United Way boycott sparked a passionate discourse about United Way on Twitter, which was catalogued at length by Press Progress, the Broadbent Institute’s online news analysis site.

Since there’s a strong case to be made that a higher minimum wage would actually help local businesses, unlike some of the foreign multinationals the CFIB’s efforts seem in reality designed to support, what small business owners in Canada should probably be reassessing is not their contributions to the United Way but their donations (in the form of membership dues) to the counterproductive lobbying efforts by the group’s senior officers.

It’s not all that complicated: since recipients of the minimum wage, like recipients of middle-class pensions, tend to spend their money on essentials in their home communities here in Canada, higher pay for low-wage workers can usually be counted on to boost local businesses and stimulate economic growth and business success in those communities

It also reduces income inequality, increases local tax income without requiring higher taxes and cuts training and recruitment costs for local businesses – all factors that counter the increased cost of higher wages to employers.

It’s interesting that supposed small-business advocates like the CFIB are pushing the idea of tax breaks for the working poor as a policy alternative to a living wage – which, of course, would transfer the costs to other taxpayers, especially in what’s left of the middle class, instead of profitable businesses that choose to resist paying a living wage.

Not surprisingly, the corporate-financed Fraser Institute was busy preaching minimum-wage fire-and-brimstone from its free pulpit at the Calgary Herald, claiming a higher minimum wage in Alberta will reduce jobs for young people and screeching about how basing policy on ideology is a bad idea – which is a bit of a laugh considering the “institute’s” record as a producer of ideologically motivated propaganda based on cherry-picked data and made-up factoids.

The two authors of the Calgary Herald’s Fraser Institute screed also made sure to scare the kiddies by beating the sinister drum that goes “Bob-Rae-Bob-Rae” without actually talking about the real reasons why the former Ontario New Democratic premier’s rule went awry – which were mainly related to his decision to abandon his social democratic supporters for neoliberal nostrums like those demanded by the Fraser Institute, plus a worldwide recession his government had no part in creating.

In fact, as Ian Hussey of the Edmonton-based Parkland Institute points out, the evidence for the Fraser Institute’s claim higher minimum wages lead to job losses in low-wage sectors is not particularly credible, and certainly not universally accepted by economists.

Indeed, Mr. Hussey does a great job of dismantling most of the CFIB and Fraser Institute assertions to reach the conclusion that despite what you’ve been hearing from the usual suspects, both workers and business owners, especially women, have plenty of reasons to get behind efforts to raise the minimum wage.

Don’t count on that happening, of course, because as noted these groups don’t really represent the people they purport to be working for. They represent a quasi-theological markets-first ideology that just happens to benefit the multinational corporations that bankroll the international think tank industry.

Back in Alberta, you can count on it that things are not very different from how they are in Halifax when it comes to a true living wage in either Edmonton or Calgary, and one hopes that the CCPA, the Parkland Institute or someone will get cracking on a similar study for Alberta’s two principal cities.

It would be almost certain to find that here, just as in Halifax, $15 is not nearly enough. Ergo, three years is too long to wait.

Never mind the hysterics of the CFIB and the credibility-challenged “researchers” at the Fraser Institute, which produces reports saying whatever its funders want it to say. The Alberta Government should legislate a minimum wage close to the living wage, and it should do it fast enough to have an impact on poverty.

As Alberta Finance Minister Joe Ceci put it not so long ago, “a person working a full-time job shouldn’t still be poor. They should be lifted out of poverty. You can’t do that on $10.20 an hour.”

Bang on, Joe. Now let’s get on with it!

This post also appears on Rabble.ca.

13 Comments to: $15 is too low, and three years is too long to wait, for a higher Alberta minimum wage

  1. keith

    June 4th, 2015

    It all comes down to whose needs you prioritize… capital or labor. I for one come down squarely on the side of labor.

    Reply
  2. Eaj

    June 5th, 2015

    “If you’re interested in credible, economically rigorous work that’s favorable to a higher minimum wage, you want to turn to Arindrajit Dube of the University of Massachusetts. And his conclusion is that the right spot for a minimum wage is at around half the median wage, about where it was in the US in the 1960s and around the current international average for developed countries.”

    http://www.vox.com/2015/6/4/8730465/st-louis-minimum-wage

    Reply
  3. Martin d'Entremont

    June 5th, 2015

    “A person working a full-time job shouldn’t be poor” is damn right, but not the total answer. The problem is that most working poor work more than one job and most of them are in precarious part-time employment.,

    Reply
  4. David

    June 5th, 2015

    I think this debate is more complex than business bad, poor people good. I find those arguments a bit too ideologically rigid. Also, while I agree people should be paid a living wage, I don’t think everyone earning the minimum wage is working full time and relying on it to live. There are many students, some people with children who only want to work part time (who have other higher earners in the household) and some retired people who want to supplement their pension income.

    I also wouldn’t discount the argument that this needs to be phased in as business needs time to adjust. I would think that this increase should be scheduled over several years perhaps an increase of $1.25 or so each year.

    Reply
    • Athabascan

      June 5th, 2015

      This argument is nonsense. A minimum wage applies to everyone. The idea that it shouldn’t apply to part times students or people who only want to work part time is just another way to object to raising the minimum.

      It would be impossible to operationalize a two-tiered system where only those who rely on it for living would receive it. All those you single out in your spurious argument would be denied. Watch then how quickly employers would transform all full timers to part timers just to avoid a $15/Hr minimum wage.

      As far as increasing it over a period of 5 years – that’s just more obfuscation. If anything it should be fully implemented now and let the employers adapt or perish. Others would take their place.

      Reply
  5. Ron Waller

    June 5th, 2015

    It should be noted that Australia has a minimum wage of about $16.50 CAD. The evidence would suggest it has had favorable effects. (Certainly no negatives: like poorer GDP growth or lower employment than other developed countries.)

    During the post-war era, real incomes grew alongside the economy, thanks to the strength of unions. But over the past 35 years real incomes have fallen and the strength of unions has been beaten back to pre-WW2 levels (meaning it would take decades for them to regain their former power, if the trend reversal started now, but the trend is further decline.) Therefore the only way to prop up wages across the board (and boost aggregate demand,) as unions did in the post-war era, is with minimum wage hikes.

    All free-market ideologues are opposed to this. But it’s thanks to their flaky hypotheses that the Western economy has collapsed. We can only move forward when we reject their pretend science as evidence-based policy. It is its very antithesis.

    Reply
  6. ema

    June 5th, 2015

    I have already sent in my opinion, to the provincial govt. – that they should get on with it and increase the minimum wage to $15 right away. That, plus cancelling corporate and union donations should be on their highest priority list, to be implemented ASAP.

    Reply
  7. June 5th, 2015

    The whole principle of remuneration in the labour force is supposed to be “equal pay for equal work”, not whether you have someone else at home who earns good money, whether you’re just another woman who wants to get out the house for a few hours, or whether you’re a senior needing a few extra bucks to supplement pension.

    This notion – a very right wing (primarily conservative) – is a pretty ancient one and I really did think the modern society had discarded such a neanderthal notion.

    EQUAL PAY FOR EQUAL WORK – is that so difficult to comprehend???

    Reply
  8. David

    June 7th, 2015

    If you want full employment, there should be no minimum wage. Period. Let the market decide.

    Reply
    • Athabascan

      June 8th, 2015

      No problem. We’ll do that just as soon as the government stops corporate welfare, and chase down all the top one-percenter tax cheats with Swiss bank accounts.

      When the so-called ‘free market” actually becomes a reality instead of neoliberal wet dream, then we can rely on it.

      I’ll ride a unicorn, but find me one first.

      Reply
      • Chris

        June 9th, 2015

        1% in Canada is about $174,000 (as of 2012, Stats Can). An Edmonton teacher with ten years work experience gets $98,000.

        Not a lot of Swiss bank accounts or top hats to be found at that income level, but quite a few dentists and restaurant owners, and Alberta Office of the Premier staffers. Oh well, they don’t create jobs or do anything useful anyway. Soak ’em for all they’re worth!

        Reply
  9. Adam Smith

    June 18th, 2015

    The free market is the best distributor of resources. There should be no minimum wage. Let the market determine a person’s financial worth. Laissez-faire.

    Reply

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