Minimum Wage Increase Long Overdue

Low-Wage Businesses Need to Calm Down and Stop Fearmongering

Edmonton – Alberta’s business lobby should calm down about tomorrow’s increase to the minimum wage.

As of tomorrow, Alberta’s lowest-paid workers will be getting $11.20 an hour, instead of $10.20. The minimum wage increase, announced by Rachel Notley shortly after her election as Alberta’s first NDP premier, is part of a plan to increase the minimum wage to $15 an hour over the course of three years.

“This increase to the minimum wage won’t make the sky fall. It won’t cause businesses to grind to a halt. What it will do is just one thing: it will make life better for Alberta’s lowest-paid workers,” Alberta Federation of Labour Secretary Treasurer and Acting President Siobhán Vipond said. “The dire warnings of affluent business owners about negative economic impacts have no basis in fact – nobody’s going to go out of business because they aren’t allowed to keep workers on starvation wages.”

There is a considerable and growing body of evidence showing that the negative economic effects of minimum wage increases are negligible, while the impact of lower-income people having more money in their pockets is quite considerable. The evidence ranges from a classic 1990 study by researchers David Card and Alan Krueger; a 2010 examination of fast food restaurants; to the 2014 British Low Pay Commission, which concluded “minimum wages boost workers’ pay, but don’t harm employment.”

Last summer, the US Department of Labour released a report showing that minimum wage increases may actually boost employment. In Seattle, after a recent increase to a $15-an-hour minimum wage, unemployment dropped and employment rates went up.

“Alberta is an expensive province to live in. It’s appalling that for most of the last decade, we’ve had the lowest minimum wage in the country,” Vipond said. “A living wage in Alberta’s two big cities is about $17.30 an hour. Outside of our urban centres, it’s about $15 an hour. So even with this increase, many people will be struggling. A minimum wage of $15 an hour can’t come fast enough.” 

According to Statistics Canada, as of the beginning of September 2015, Alberta has the highest Consumer Price Index in the country, and remains the most expensive province to live. Ontario, which has one of the lowest CPIs in the country, has a minimum wage that will still be higher after Alberta’s minimum wage increase

“Last year, the number of workers in Alberta who were earning minimum wage increased from 26,600 to 38,600,” Vipond said. “Minimum wage is no longer just about kids getting their start – an increasing proportion of minimum-wage workers have been working at their jobs for more than five years. Minimum wage workers are predominantly women, almost half of them are over the age of 25. The fastest-growing segment of minimum-wage workers are those over the age of 55.”

“This government has taken a good first step for low-wage workers. They shouldn’t cave to the business community’s agitation and fearmongering,” Vipond said. “I look forward to a day when every Alberta worker is earning enough to get by.”

 

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MEDIA CONTACT:

Olav Rokne, Communications Director, Alberta Federation of Labour at 780.218.4351 (cell)
or via e-mail orokne@afl.org


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