The Alberta government recently announced their schedule of minimum wage increases for the next three years. The New Democrat platform in the last provincial election included a promise to increase the provincial minimum wage to $15 per hour by 2018. Last week’s announcement accomplishes just that, with scheduled increases of $1 on October 1, 2016, a further increase of $1.40 on October 1, 2017, and another $1.40 on October 1, 2018. The province also announced the elimination of the two-tier minimum wage whereby workers who serve alcohol had a lower minimum wage than anyone else.
The push toward a $15 minimum wage is not exclusive to Alberta, as many jurisdictions across North America will be moving in that direction over the course of the next couple of years. The premise is simple: anyone who is working full-time should be able to afford the necessities of life—shelter, food, clothing—with their earnings. Sadly, in Alberta, that has not been the case for some time now: over the past few years, cities across the province have reported a significant—and growing—gap between the provincial minimum wage and what would be considered a living wage. The result has been growing numbers of full-time workers being forced to access food banks and work significantly more than full time to pay for rent and utilities. Alberta has the dubious distinction of having both the highest and fastest growing rates of income inequality in the country.
The response to the government’s announcement by the province’s radical right and the business lobby was predictable. The Canadian Taxpayers’ Federation (CTF), the Canadian Federation of Independent Business (CFIB), the Wildrose Party and Restaurants Canada all chimed in with similar-sounding assertions: now is not the time for an increase (although none said when a good time would be); the move will cost thousands of jobs and force businesses to close; and a minimum-wage increase would further deepen the current economic slump.
The problem with all those assertions is that the bulk of the research that has been done on the subject does not support any of them. In fact, the research shows the opposite: increasing the minimum wage will have negligible to no impact at all on jobs, the economy, prices or the success rate of small businesses. If there is an impact on jobs, it will be small and focused almost exclusively on teenagers and particularly low-skilled workers. It will not, by any stretch of the imagination, bring the entire economy to a screeching halt.
As spokespersons for the CTF and the CFIB tossed around words like “irresponsible” and “ideological” to describe the government’s move, they never once stopped to explain how a minimum wage that prioritizes business profit margins at the expense of people’s ability to access the necessities of life is responsible. It is also almost comical to hear these groups describe the government as ideological while failing to acknowledge that wage suppression is at the very core of the ultra-right wing neoliberal doctrine they espouse, and which is echoed loudly by the likes of the Fraser Institute and Frontier Centre for Public Policy, and whose promotion is handsomely funded by the likes of the Koch brothers and Canada’s corporate elite.
To accuse what is ultimately a centrist government of being ideological—while acting as foot soldiers for the low-wage, low-tax, anti-government, pro-privatization mantra of the extreme right—is absurd and highlights the degree to which these groups should not be taken seriously.
Ultimately, a $15 minimum wage will make a significant difference for the almost 300 000 Albertans currently earning less than that. And when you factor in the reality that low-wage earners tend to spend 100 percent of their paycheques, putting more money into these people’s hands will directly translate to more money being spent in the local shops and businesses where they live—which can’t help but be good for the economy.
In fact, when you consider that a living wage in places like Edmonton, Calgary and Grande Prairie would currently be more than $15 an hour, a strong argument could be made that the government did not go far enough in their announcement—but that is an argument for another day. For now, let’s celebrate that the government has fulfilled this promise and that our entire province will benefit from it. V
Ricardo Acuña is the executive director of the Parkland Institute, a non-partisan, public policy research institute housed at the University of Alberta. The views and opinions expressed are his own and do not necessarily reflect those of the Institute.