Minimum wage set to increase to $15
CFIB say small businesses will be hit the hardest while others say the hike is necessary for low-income earners
By Amy Tucker, News Editor
The economic downturn has undoubtedly affected small businesses. Now following the Alberta Government’s announcement last week that $15 an hour minimum wage has been enacted in regulation, one in four small businesses say they will have to layoff an employee.
According to a survey by CFIB – an organization representing the interests of small businesses – the impact will be severe. The report shows that 26 per cent of businesses say they will reduce the hours of staff and cut down on the number of employees.
The repercussions of the wage hike will be staggering unemployment rates, the organization says.
“Job losses from minimum wage increases can take the form of hiring freezes, slower employment growth, or direct job cuts during an economic downturn,” the CFIB states.
The survey also showed that 89 per cent of small businesses disagreed that government should increase the minimum wage rate during economic downturns. Only two per cent of respondents agreed while nine per cent don’t know.
“Premier Notley stated that her aggressive minimum wage policy won’t kill jobs. Then show us the evidence. Small business owners have expressed a fundamentally different perspective based on their experience. If the Premier valued the views of entrepreneurs she should listen and act on what they have to say,” says Amber Ruddy, CFIB’s Alberta Director.
However, some say that it’s not as black and white as labour costs going up and jobs being lost and that a hike in minimum wage won’t necessarily put a chill on the economy.
“There’s a very mixed impact on the overall economic impact of minimum wages,” Professor of Economics at Carleton University Francis Woolley told Global News.
Public Interest Alberta and the Alberta College of Social Workers released low-wage data for the year. According to the report, nearly one in five workers are earning low wages in Alberta.
Low wages included those earning $16 per hour or less is 21.2 per cent of employed Albertans and those earning the current minimum wage ($12.20 per hour) or less is 8.3 per cent of employees.
The data from the report also shows that 60 per cent of low wage workers are women, 77% per cent of low wage workers are 20 years and older, and 32.6% are between 25 and 44 years old.
“The image of a teenager living in their parents’ basement and working just to earn extra spending money is not the reality for most low-wage workers,” said Public Interest Alberta Executive Director, Joel French. “Most of these workers are in their prime earning years and are at the stage where they are planning for or are already supporting families.”