Alberta's minimum wage will jump to $8.40 per hour from $8 per hour on April 1, making it the highest minimum wage in Canada after taxes, but the Alberta Federation of Labour says it's still not enough.
Last June, the province announced that the minimum wage would be adjusted according to the average weekly wage index beginning in April. The index is based on an annual survey of employment, payroll and hours provided by Statistics Canada.
This year's five per cent increase is due to a 4.7 per cent increase in Alberta's average weekly wages from January 2007 through December 2007, according to Stephanie Francis of Alberta Employment and Education.
"It was rounded up to make it easier for payroll, for employers. And it's also more understandable for everyone as well," she said.
Because minimum wages are based on the average weekly wage index there are two possible outcomes, according to Francis.
If the average weekly wage increases, the minimum wage increases by the same per cent. If it remains the same or decreases, the minimum wage will stay the same.
"The minimum wage will never decrease," Francis said.
Though Gil McGowan, president of the Alberta Federation of Labour, approves of the government's decision to have minimum wage increased according to the average weekly wage index, he said it still doesn't allow for an adequate income.
He said the minimum wage should have been adjusted to the average weekly wage index years ago and it has limited effect now because the base rate is too low.
"The real value of the minimum wage has eroded substantially," McGowan said.
"Eight dollars and forty cents is simply not enough to keep someone out of poverty anywhere in Alberta, especially in high-cost locations like Fort McMurray, Calgary, Edmonton, even Fort Saskatchewan," he said.
"At that wage you would have to work 100 hours per week to keep yourself above the poverty line."
McGowan said he would like to see the base rate increased to about $11 to $12 per hour and then have it indexed as it is.
"Until that happens, the minimum wage in this province still won't be doing what it is supposed to be doing."
But Francis said the majority of those earning minimum wage are younger than 20 years old.
"Many of them are still living at home and this is a way for them to earn a little extra money that they might like to have," she said, adding that Alberta's minimum wage is meant to keep pace with minimum wages across the country.
Before taxes, Alberta will have the third highest minimum wage in the country come April 1. Only Ontario and Manitoba have higher minimum wages.
According to Alberta Employment and Immigration, 3.5 per cent of Alberta workers, about 70,000 people, are earning minimum wage. The majority are 15 to 19 years old and are working in food services and hospitality.
Francis said the next potential increase could come in April 2009.
Fort Saskatchewan Record, Tues Mar 25 2008
Byline: Paul Grigaitis