Every time talk turns to an increase in minimum wage, dire warnings abound about the imminent death of business. But, to paraphrase Mark Twain’s famous quip, the report of the death of business is greatly exaggerated. Three years ago when a tiny increase was made in the minimum wage after five years of being static, the Ontario Chamber of Commerce reacted in horror and pronounced business’ demise. Here we are in 2017 and businesses are still doing business.
Ontario labour laws are way out of date. In addition to raising its minimum wage, the plan is to legislate more predictable work hours, improve sick leave and vacation requirements. The nature of work in Ontario has shifted and that needs to be reflected in the workplace.
There are lots of reasons that businesses fail: failure to understand the market; inadequate financing; poor management. Rarely does one see ‘paying staff a humane wage’ as one of those reasons for business failure.
Of course businesses dislike price increases. Who likes to pay more for anything? Small businesses don’t work if they have everything else but lack a fairly compensated employee base. We should not begrudge employees for wanting to achieve more financially. Those who see their compensation as unfair or exploitative cost businesses more in the long run due to poor morale and a decrease in productivity. An increase in the minimum wage is bestowed upon businesses across the board so the playing field remains level.
If you can’t afford to pay a living wage, you can’t afford to be in business. Asking people to work for poverty wages is the height of entitlement. You are using others to subsidize your dream of having a business. Yes, you are the one taking the risk but when your business thrives, thanks to help from your employees, you’ll be comfortably off and they may still be working for you. And no…you didn’t do it on your own.
Elizabeth Warren made this point: “There is nobody in this country who got rich on his own — nobody. You built a factory out there? Good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police-forces and fire-forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory — and hire someone to protect against this — because of the work the rest of us did. Now look, you built a factory and it turned into something terrific, or a great idea. God bless — keep a big hunk of it. But part of the underlying social contract is, you take a hunk of that and pay forward for the next kid who comes along.”
I respect small business. Our two children and their spouses are all hard-working small business owners. I know a dozen business owners here in town who already pay more than minimum wage. And there are a few who pay a living wage. Some do it simply because they believe it’s the right thing to do but they all think it’s also good business. For anyone who is already compensating staff above minimum wage, the increase will have little impact in the short term. Will other staff then need to be bumped up, too? Probably. But, the further you get from minimum wage the less the adjustment needs to be.
I looked at kijiji apartment rentals before I started this opinion piece. What was notable was that the majority of rents being advertised was between $1,000 and $1,350 per month. The majority of those looking for apartments hope to find something between $700 and $900 a month. Those who are working precarious jobs with fewer than 40 hours a week could easily spend between two-thirds to three-quarters of their income on rent.
Poverty is a public health issue. Poverty and poor health are inextricably linked. The causes of poor health are rooted in political, social and economic injustices. Poverty is both a cause and a consequence of poor health. Poverty increases the chances of poor health. Poor health in turn traps families in poverty. And make no mistake, even at $15 an hour people are still going to be poor. Sixty percent of low-wage earners are women, so the increase will also help to close the wage gender gap. When women win, so do families.
Expert opinions and conflicting research exists on either side of the minimum wage debate. But there are some facts which are pretty irrefutable: just 20 years ago, one in 40 Ontario workers made minimum wage. Today that number is one in eight. That’s a boatload of working poor here in one of the largest and richest provinces. Large corporations are good at making a profit. It’s mind boggling that we can be outraged by the audacity of working poor wanting a bit more and just gloss over the fact that the ratio of CEO-to-worker-pay has increased 1,000 per cent since 1950.
In a new study from the Canadian Centre for Policy Alternatives, they found that low-paid jobs were increasing at a pace three times that of overall growth. At a time when the number of jobs grew at 30 per cent, the number of low-wage jobs grew 94 per cent. And poorer working conditions comes right along with low-paid jobs.
The report also dispels the myth that minimum-wage workers are mostly teenagers who still live at home and use their money for personal luxuries. Fully one-third of low wage earners are in their prime earning years of 25 to 54, while almost nine per cent are over 55. The remaining 57 per cent are under 25.
Higher minimum wages are often cited as being particularly hard on young people who need the experience of working minimum-wage jobs. But in places with a higher minimum wage, like Scandinavian countries, the Netherlands, Australia and New Zealand, the minimum wage had no effect on unemployment.
Some businesses will warn that if their payrolls increase, prices will follow, and then there will be corresponding inflation requiring even higher wages and so on and so on. History both past and recent demonstrates that this is not the case. In Minnesota the governor raised the minimum wage and taxed the high-income earners more. Instead of increasing unemployment the exact opposite happened. The state went from the 32nd fastest growing state, to the fifth, and boasts the highest economic confidence of all the US. He turned a $6.2 billion deficit into a $1 billion surplus over the course of four years.
I think it was Donald Trump who said during the U.S. presidential campaign, “We can’t raise the minimum wage if we are going to remain competitive.” That is pure bull***t. Minimum-wage workers aren’t even involved in the export sector of industry. Paying cleaners, servers, cooks, retail-sales people more has nothing to do with competing with the rest of the world.
The vitriol that is being heaped on Kathleen Wynne is mostly undeserved. I’m fairly sure that her intent is not to shut down business. I have a feeling….and some of you are going to guffaw at this….that at the end of the day history may remember Ms. Wynne as an effective, compassionate premier who did incredibly difficult things to provide a little bit of dignity and security for people who have no power themselves.
For the cynics, yes, an election is looming. BUT the economy is booming, too. So if not now, when?
Don’t miss out on Doppler! Sign up for our free newsletter here.
Following a career in the hospitality sector and the acquisition of a law and justice degree in her 50s, Dale embarked on a writing career armed with the fanciful idea that a living could be made as a freelancer. To her own great surprise she was right. The proof lies in hundreds of published works on almost any topic but favourites include travel, humour & satire, feature writing, environment, politics and entrepreneurship. Having re-invented herself half a dozen times, Dale doesn’t rule anything out. Her time is divided equally between Muskoka and Tampa Bay with Jim, her husband of 8 years and partner of 32 years. Two grown ‘kids’ and their spouses receive double doses of love and attention when she’s at home.