As Ontario prepares to raise its minimum wage by 2019 from $11.60 to $15.00 an hour, a warning is being issued from the most unlikely of places – Muskoka’s Community Services Department.
At the District’s October 18 Community Services Committee meeting, staff recommended that Muskoka respond to the Province’s request for feedback and express its concern with what could be the unintended consequences of the proposed hourly wage increase. Their concerns include a reduction of employment hours in businesses that employ minimum wage employees; a reduction of hours and consequently a reduction of income for those making minimum wage if the hourly wage increase does not compensate for the possible reduction of hours; staff also noted Muskoka’s seasonal nature and said, “employers are most likely to make workforce reductions in the seasonal, service and food industries which are predominant in Muskoka and rural Ontario.”
District Chair John Klinck said the recommendation, which was passed by committee, took him a bit by surprise. “You would think that at first blush anything that would raise the potential for anyone, in terms of income, would be a blessing. But at community services, our staff have a little bit of a different take on it,” he said.
“We all know it’s not easy to be a business owner in Muskoka with the seasonality and we know that there’s a great number of jobs that are categorized from the lower end of the pay scale and the fear is in order to perhaps balance the books it could very well be that hours are perhaps cut back a little bit. I’m optimistic that that’s not the case but, notwithstanding, we felt it appropriate to send a cautionary note to the Premier and her colleagues just to let them know that things are a little bit different here in Muskoka,” said Klinck. “I continue to be optimistic that it won’t have a significant impact but we all know any time wages go up it is going to be passed along through the food chain sort of speak.”
District Commissioner of Community Services Rick Williams said while staff agrees with an hourly wage increase in principle, and it could be beneficial for some, there is concern with the speed and magnitude of the increase.
I don’t think anyone knows exactly how this is all going to play out, but there is some concern and some surveys showing that many employers are likely to cut back on the either number of jobs they have or the hours of employment in small businesses and that that might be more dramatic in rural or seasonal businesses and that’s bound to impact some people negatively.
Rick Williams, District Commissioner of Community Services
Williams referenced studies conducted by the Ontario Chamber of Commerce and the Financial Accountability Office of Ontario that concluded that there could be anywhere from 60,000 to 75,000 jobs eliminated. “And that’s bound to have some impact in Muskoka,” said Williams, who added that while hourly wage increases are a good thing, they should happen in small increments – especially in rural and seasonal communities. “We thought that maybe a slower pace might not have the negative impact,” he added.
The recommendation from staff and committee is expected to make its way to District Council in November for final approval before it is forwarded to the Province.
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What happens if WE do NOT have a raise , that means more tax payer funded payouts for very costly social supports into the low or no retirement plan days . Is this concern our of fear social support jobs will be less required . Fear not Ontario PC leader has indicated that low wage workers are REQURIED . We shall see in increase in have vers have not Ontario voters with tax payers wanting less taxes and social budgets stretched way too far . Let means test those that have or require low wage workers to insure that the tax payers are not getting stiffed for salary or investor increases . If worker need to be means tested so do Buiz owners to determine eligibility for my tax dollars .
I think the government and many others have not looked at the big picture regarding an increase to minimum wages. There are many employees now who work between the present minimum wage and the proposed one, there are also many who work for an amount just above the new minimum. Does anyone believe that someone who has been working in any industry for several years at a wage just over $15.00/hrs will be content to continue to do a good job if entry level workers are paid the same rate of pay as them? Will there be substantial pressure placed on the employer to increase the wages of these long time employees to maintain an exceptable wage gap, or will they simple not hire new staff in order to keep present staff at the same level of pay? Can a maximum wage be far off, or does the union run government managed by the top 10% dare mention such a possibility? Union, associations of all types spend much time and effort lobbying governments at all levels. Funny how people who rarely if ever pays the price asked for a product or service without either negotiating a lower price or seeks out a lower price elsewhere, thus driving down prices, expect those same businesses not to be able to negotiate their cost of workers wages. Should workers not be allowed to negotiate the wage they are willing to work for rather than have no job or seek out social assistance?
Excellent response Jim. It is disturbing how often critical facts about a situation are ignored. People discussing the proposed minimum wage hike (and the proposed tax changes) are almost entirely focused on one side of the issue. Where is the objective reporting?
The Chamber of Commerce has focused their campaign on potential costs of a wage hike. There are 2 potential benefits that should be considered.
1. The 23 billion in extra cost is going right back in to the economy. Just as there is a “potential” for job cuts, there is a potential for job growth. Consumer spending is 70% of the economy.
2. And this one puzzles me in regards to community services, it will make a dramatic difference in the lives of the 30 percent of Ontario workers that are paid minimum wage. Maybe less will need community service?
The business community has paid lobbyists, the workers do not. I guess I am not surprised that community services chooses to support the paid industry lobbyists.