Minimum wage a tool for change

Hey there, time traveller!
This article was published 02/10/2012 (4998 days ago), so information in it may no longer be current.

“We continue to boost the purchasing power of minimum-wage earners and this move can also benefit business as it helps attract and keep workers.”

— Manitoba Labour Minister Jennifer Howard, in a media release.

For Manitoba’s NDP, a political party that tends to tinker with the tools of government at the detriment of the private sector, regular upticks to the provincial minimum wage have become the norm.

On Monday, Manitoba’s minimum wage increased by 25 cents to $10.25 an hour. This is on top of the 50-cent minimum wage increase that kicked in on Oct. 1 in 2011, and still another 50-cent increase one year earlier.

This continuous rise in minimum wage over the last several years has exceeded average cost of living increases that non-minimum wage earners generally receive. The big question on the minds of small and large business owners, of course, is where are these increases leading?

The minimum wage was introduced nearly a century ago to curb and control sweat shops in the manufacturing sector. The first provinces to enact minimum wage legislation — for working women at first who were seen as more vulnerable to exploitation — were British Columbia and Manitoba in 1918, according to the federal Department of Labour.

But it’s rather clear that minimum wage has, over time, evolved as a tool for social change.

If you ask the Manitoba Federation of Labour, these minimum wage increases are a mere pittance to what they should be. On Monday, the MFL called for the NDP to transform the minimum wage into a living wage of $12.12 per hour.

“A 25-cent increase in the minimum wage falls far short of what’s needed to bring Manitoba’s working poor to a living wage,” Kevin Rebeck, an MFL spokesperson for the Working Families Manitoba campaign, said in a release. “Anyone who works full time deserves to earn a living wage — enough to sustain a decent life.”

The MFL said minimum wage earners are not always the stereotypical teenagers and students working for small businesses. The labour organization suggested that a majority of minimum wage earners are adults and that a large percentage of them work full-time hours. It also suggested that women are much more likely to earn minimum wage than men.

We do not object to the fact that minimum wage earners need to have a bump in pay from time to time. As the costs of living increase, so should minimum wage.

There is also an argument to be made that increasing the minimum wage to a living wage would encourage more people who are currently reliant upon Employment Insurance and other government safety nets to join the workforce because they could actually make a living.

The problem here is that there is no end in sight. What exactly constitutes a living wage? And how do you measure a decent life? And at what net cost?

When governments increase the minimum wage, they do so on the backs of the private sector, a situation that consistently and substantively damages small businesses in this province.

While the NDP’s labour and finance ministers have incessantly crowed about how their government has eliminated Manitoba’s small business tax, what they don’t say is that the lack of taxation has become a moot point as salary costs continuously grow.

According to statistics cited by the Canadian Federation of Independent Business in April, business optimism in Manitoba is low compared to the surging optimism in Alberta, Saskatchewan and even Ontario. At the same time, taxes and regulations as well as wages remain the top cost pressures for about 63 per cent of small businesses in this province.

And yet, as we have continuously pointed out, the province has refused to lower the basic personal tax exemption — the amount of money one can earn before being subject to income tax. That act alone would give the working poor more money in their pocket and help improve Manitoba’s business climate.