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$15 Minimum Wage in Alberta

40K views 154 replies 47 participants last post by  Just a Guy 
#1 ·
NDPs are pushing through a $15 minimum wage.

Is this going to cripple small businesses, or just trigger crazy amounts of inflation...? Bad time to be a business owner?

Thoughts?
 
#2 ·
Seattle is the only one so far that I know that has approved a move to a $15 minimum wage.

For small business it would initially mean trying to cut back workers and hire less. Down the road however since every business has to pay it, workers will have more money to spend on small business products. Small business in return may be able to charge more for those products creating the inflation. Then there will be a bump up of all wages to keep their premium over minimum wage, creating more inflation. Of course once everything settles in the inflation rate will drop back down again. I would think other provinces would gain from this because the people of Alberta will be able to spend more there and as long as they don't match Alberta's minimum wage. This could also hurt business as money leaves the province finding cheaper goods.
 
#30 ·
This could also hurt business as money leaves the province finding cheaper goods.
Alternatively, large, multi-national businesses will not be able to discriminate against Alberta and will keep prices in line with the rest of the provinces. In turn, this will make Alberta wealthier. I would agree with you if every province raised their minimum wage, but with only one province doing so, and so drasitcally, I honestly have no clue what the impact will be.
 
#7 ·
Personally I don't feel minimum wage should be raised. In my opinion, you shouldn't be able to live and support a family on minimum wage - that's not the intent. If you are working at a job and still making minimum wage after several years, I would say it might have something to do with performance.

Anyway, just my thought - I always catch some flack for my stance on minimum wage :)
 
#8 ·
Of the people earning the minimum wage, very few are 'heads of households' or breadwinners. Many are secondary or tertiary earners in middle class households (including teenage children and students). Raising minimum wage as a poverty alleviation tool is of questionable efficacy. There are many people who are 'poor' that earn more than the minimum wage (single mothers for instance) and would not be helped by raising it.
 
#11 ·
The Premier is not suggesting an immediate increase to $15

It is a three/four year goal with incremental steps. Last numbers I saw were that 1.2 percent of Alberta workers were earning minimum wage.

But, it will drive up those wages that are above minimum wage.
 
#13 · (Edited)
Alberta's protest vote is unleashing a massive economic experiment. Higher taxes, higher minimum wages, possibly higher oil royalties.

What I've read about minimum wages in Canada recently is generally those earning the minimum are quite young and still at home. If the goal is to alleviate poverty, it will be alleviating the poverty induced by cell phone bills and movie tickets.

Not to mention, how can it not push wages across the board up? Those earning 50% higher than minimum wage currently will be at the minimum wage in a couple years and certainly if you are supervising those earning a minimum wage, you will demand that your wage be elevated to maintain yourself in the wage hierarchy.

And consider your average fast food restaurant with a dozen or more people running around serving coffee or whatnot, suddenly those employees cost much more and your cost structure is seriously derailed. Prices have to rise or jobs must be cut. As an accountant that pours over payroll reports weekly and under pressure by management to find savings at all times, something has to give, and it's probably hours.

In Manitoba the NDP has been increasing the minimum wage aggressively and child poverty and poverty in general has not improved, but fast food meals have increased in price.
 
#14 ·
What I've read about minimum wages in Canada recently is generally those earning the minimum are quite young and still at home. If the goal is to alleviate poverty, it will be alleviating the poverty induced by cell phone bills and movie tickets.
While that may be true, there are many adults making just a few dollars over the minimum. I know a couple of people who make $12/hr. And they're not unskilled either -- both used to make about $22/hr before their company downsized and laid them off. Unfortunately, most jobs available right now are low-paid and these people who previously made a decent living are now struggling.

Not to mention, how can it not push wages across the board up? Those earning 50% higher than minimum wage currently will be at the minimum wage in a couple years and certainly if you are supervising those earning a minimum wage, you will demand that your wage be elevated to maintain yourself in the wage hierarchy.
By the time the new minimum is fully phased in, those currently making $15/hr would likely be making $16 or $17 anyway. People can of course ask for raises, but that doesn't mean employers are going to give them a raise just to keep a cushion between them and minimum wage. And I really don't see the majority of people who make over $20/hr being too threatened by someone making $15.
 
#15 · (Edited)
First i think some clarity around the current minimum wage situation in Alberta is in order.

Currently in Alberta there are 2 minimum wages. There is the standard $10.20/hr, and then there is the $9.20/hr liquor server minimum wage. The reason for this should be quite obvious in that liquor servers are able to bring in a great amount of tips to offset their wage. The other thing is that although the minimum wage is $10.20/hr very few businesses have been paying that wage to adult staff (the individuals that I believe the increase is targeted to help). For reference I recently went to a Wendy's where the starting hourly wage advertised on the now hiring sign was $13/hr for full time (obviously a job for an adult as it would be full time hours, and no this was not in Fort Mac or far up north, it was in Okotoks which is 15 mins outside of Calgary where many people commute from to work in Calgary). I do also believe that the position at Wendys comes with benefits but don't quote me on that. I would also say that the majority of individuals on minimum wage are current high school students/recent high school graduates and temporary foreign workers (yes they are still here and working). Now can someone tell me how gradually increasing these individuals hourly wage by $4.80 over 3 years is going to help the working poor?

As a resident of Alberta, and as an individual who worked minimum wage jobs in my youth including in bars/restaurants, I will wait and see how this turns out but i know my spending as a consumer will change from it.

The main thing that is going to change for me is if this truly is a increase in both minimum wages to $15/hr is i'm going to stop tipping the customary 5-20% on a meal, and $1-$2 for a beer. Don't get me wrong though, if i have above average service i will still tip an appropriate amount, i just won't be tipping for expected service if you're making $15/hr. Having worked in the bars/restaurants as both a doorman and bartender i can tell you the hourly wage wasn't what you worked for. People in these positions work for the tips/tip outs. It's not uncommon for a bartender to leave at the end of the night with anywhere from $300 to over $1,000 in "tax free" tips which works out to a substantial amount more than what i'll leave the office with having made that day and theirs is "tax free"! If I no longer feel that i have to supplement your wage with tips then i won't, plain and simple.

One last thing i would just love to get off my chest in what could be considered a public forum instead of just among family and friends is this.

Just because you live in Alberta where the energy industry pays high salaries to skilled individuals, or individuals that are willing to work long grueling schedules far from home, does not mean that you should also be paid more to work an unskilled, or 9-5 M-F job! Everyone has to work hard for what they have and want. If you want to make that type of money then make the sacrifices that go along with it such as long hours far away from family and friends! If you need to complete more education than do it! But just because there are a lot of individuals in Alberta making high incomes which raises the cost of living does not mean that people unwilling to do that work, or obtain further education to get higher paying jobs, should be given a raise base simply on the fact it costs more than average to live here and not the merit of their work.
 
#21 ·
The other thing is that although the minimum wage is $10.20/hr very few businesses have been paying that wage to adult staff (the individuals that I believe the increase is targeted to help). For reference I recently went to a Wendy's where the starting hourly wage advertised on the now hiring sign was $13/hr for full time (obviously a job for an adult as it would be full time hours, and no this was not in Fort Mac or far up north, it was in Okotoks which is 15 mins outside of Calgary where many people commute from to work in Calgary). I do also believe that the position at Wendys comes with benefits but don't quote me on that.
That's a good point, and actually I think those are the people this increase is really going to help -- adults who are stuck in full-time jobs, not making minimum wage but close to it. There are a lot of circumstances where someone might have to take a job making $13 an hour. Not all of them are lazy or unskilled.

One big benefit that I don't see mentioned is that it will allow high school and college students to work fewer hours for the same amount of pay, which is really helpful when you're trying to juggle school, work, studying, and still have some kind of a social life.
 
#16 ·
Wage inflation is something most economists say is badly needed in the economy.

The effect of raising minimum wages generally increases wages for everyone who earns below or just above the minimum wage.

Some wage inflation would be a good thing.
 
#19 ·
Wage inflation when there is a shortage of labour is one thing, artificially raising wages when there is a surfeit of workers is surely something else again?

Besides, if you increase the payments made to those who basically move hamburgers from one counter to another, isn't it anticipated that those with greater skills will demand even bigger increases?
 
#18 ·
One argument I don't understand is the argument Peter Schiff makes that there shouldn't even be a minimum wage. He claims this is how you get people skill trained for the real world. While I understand this part of the argument it doesn't stop the slavery of some of the work force which many will do if they can get away with it. Some may have no choice but to pay near nothing to compete in some areas.
 
#20 ·
Are there any small business owners from Alberta on this forum bychance?

I am curious because the province has gone from large TFW labour force (generally considered strong labour force for a great price) to current labour costs, and then in a few years to a $15 one. I am wondering if companies are seeing their labour cost jump from 20% to 25% to 40% of total revenue in the span of a few years...?
 
#23 · (Edited)
The labour supply and demand equation is touted by employers and those who support lower wages, but when the supply of labour runs low and wages should rise as a consequence, they want to change the rules and bring in cheap foreign workers.

Alberta workers should be thankful they have the NDP in power now, and will make some changes for the benefit of workers and Albertans.

The Conservative government wants to make it easier for companies to lay off workers, according to Finance Minister Joe Oliver.

His convoluted theory is that layoffs encourage more employment......LOL

No wonder people want a new government.
 
#28 ·
The labour supply and demand equation is touted by employers and those who support lower wages, but when the supply of labour runs low and wages should rise as a consequence, they want to change the rules and bring in cheap foreign workers.

Alberta workers should be thankful they have the NDP in power now, and will make some changes for the benefit of workers and Albertans.

The Conservative government wants to make it easier for companies to lay off workers, according to Finance Minister Joe Oliver.

His convoluted theory is that layoffs encourage more employment......LOL

No wonder people want a new government.
Doesn't it?

If a business knows it is difficult to layoff an employee due to regulation they will try really hard to manage with what they've got and resist hiring another person unless they are supremely confident that their workload will remain high.

If it is easy to lay off an employee then the company will much more willingly hire a new person now because there is a need now, knowing that if business slows down in the future they can lay-off if necessary.
 
#29 ·
I don't think raising the minimum wage is intended to create jobs directly.

Consumer demand is the only force that does that.

Raising wages of those already working creates the consumer demand, that in turn creates the jobs.

People living on minimum wages are spending everything they earn.

It is income redistribution...........from the business owner's pocket to the worker's pocket.

And given the growing wealth and income gaps...........it is long overdue.
 
#31 ·
I don't think raising the minimum wage is intended to create jobs directly.

Consumer demand is the only force that does that.

Raising wages of those already working creates the consumer demand, that in turn creates the jobs.

People living on minimum wages are spending everything they earn.

It is income redistribution...........from the business owner's pocket to the worker's pocket.
And given the growing wealth and income gaps...........it is long overdue.
I disagree. it is distribution from high income tax payers to low income workers to business owners. The price inflation of low-end products, services, and housing for the current poor will more than offset the increased cost of wages experienced by the business. Low income workers will be in the exact same situation as they were, bottom of the totem pole and only able to afford all the worst stuff available, just as before.

The real winners are the businesses that provide goods and services to low income people, through inflation.

The low income earner goes nowhere. Exactly the same as before.

The real losers are the high income employees who now owe more tax, and pay more for goods and services. Also the businesses that rely heavily on minimum wage workers but sell their product to upper middle class people. They get increased cost and no increased revenue.
 
#32 · (Edited)
Read Nick Hanauer's article "The Capitalist’s Case for a $15 Minimum Wage.”*http://www.bloomberg.com/news/articles/2013-06-19/the-capitalist-s-case-for-a-15-minimum-wage

Also his related article on income inequity "The Pitchforks are Coming ... For us Plutocrats" http://www.politico.com/magazine/st...orks-are-coming-for-us-plutocrats-108014.html

This Quote from the latter: "Wal-Mart is our nation’s largest employer with some 1.4 million employees in the United States and more than $25 billion in pre-tax profit. So why are Wal-Mart employees the largest group of Medicaid recipients in many states? Wal-Mart could, say, pay each of its 1 million lowest-paid workers an extra $10,000 per year, raise them all out of poverty and enable them to, of all things, afford to shop at Wal-Mart. Not only would this also save us all the expense of the food stamps, Medicaid and rent assistance that they currently require, but Wal-Mart would still earn more than $15 billion pre-tax per year. Wal-Mart won’t (and shouldn’t) volunteer to pay its workers more than their competitors. In order for us to have an economy that works for everyone, we should compel all retailers to pay living wages—not just ask politely."

When people don't make a living wage, they have to rely on public housing, welfare, and other social programs to get by - all paid for by taxpayers. Instead of saying "Thank-you for shopping at Walmart", Walmart staff should be trained to say "Walmart executives thank you for supplementing their employees' meager wages with your tax dollars, so that Walmart can continue to drive its fair-wage competitors out of business with lower prices."
 
#33 · (Edited)
^thanks for posting that. I've read them both some time ago but for me its a breath of fresh air since I agree totally.

I'm 100% for raising the minimum wage to something much more livable for all, for all the reasons in the article, as well as my personal experience associated with the retail space in the phase down part of my career. When I owned my company I refused to pay wages nearly that low even though I could likely have made a few more dollars myself by being really cheap.

Companies that need to be told by government what the lowest wage is they can pay is not something to be proud of.
 
#34 ·
To put Alberta's plans in perspective:

The 2014 Minimum wage in Alberta of $10.20; when adjusted to "constant dollars" using the CPI, is the same as it was in 1978 ($1.43 in 1966 dollars). It dropped about 30% from 1978 to 1984, and for the next 20 years it remained within +/- 10% of the $1.00 rate in 1966.
 
#35 ·
....plus the rate is not going up to $15. tomorrow. It will be phased on over several years.

As an Albertan, living for the past 15 years in what arguably the wealthiest province in Canada, it was embarrassing to think that we had one of the lowest, and at time the lowest, minimum wage in the country.

It is always interesting to note that the people who are most against a minimum wage are usually the individuals whose own income is far, far above minimum by any imaginable standard.

The world is not going to come to an end in Alberta because we do the right thing and increase the minimum standards.
 
#36 ·
Fully agree. It was embarassing when I lived there to see that disparity. There should be a minimum of 20 work hours a week as well which is only circa $16k/yr. No way to live on that amount either.
 
#37 ·
A lot of restaurants pay minimum wage, or close to it, but because of the tips the servers are still making good money. With a 50% raise in food costs, restaurants are going to have to raise their prices an equivalent amount. Then the customer, knowing the server is now making a living wage, will likely cut down or eliminate his tip. The server will be no further ahead. Actually they will be behind because all the servers I have ever known (myself included when I was one in my 20's) do not declare all their tips on their taxes. So, if the minimum wage goes to $15, they will be getting taxed on more of their income, which is fair. I pay tax on all my income.

Anyway, expect restaurant, bar and fast food prices to rise significantly.

And, for the record, I am totally in favour of raising the minimum wage.
 
#39 ·
I so tend to agree with PG that servers in certain restaurant businesses may be no better off but the increase in minimum wage will help all those that don't really see the tipping trade, e.g. fast food, hotel cleaning staff, retail store staff, etc. Society will be better off.
 
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