Hundreds of thousands of workers in Ontario are celebrating this week after that province’s Liberal government announced it will increase the minimum wage to $15 an hour.
As part of a broader effort by the Kathleen Wynne Government improve labour standards in that province, the increase will be phased in, bringing the current $11.40 minimum wage to $14 an hour on Jan. 1, 2018, and then up to $15 an hour on Jan. 1, 2019.
The announcement included improvements to other minimum labour standards for all workers in the province as well: increased annual vacation, increased personal leave days, improvements to shift work, and measures that make it easier to form a union in certain sectors (through card-based certification, a measure that the Progressive Conservative government scandalously eliminated in this province in 2014).
Ontario is the second province to announce a $15 minimum wage. Alberta is bringing will follow suit by October 2018.
“Fight for $15” campaigns have been successful in several American jurisdictions: New York State, California, the cities of Seattle and San Francisco, among others. Workers across North America are fighting tenaciously for a $15 minimum wage as the first step toward a fair and living wage. And in jurisdiction after jurisdiction, their hard work is paying off and they are winning.
Newfoundland and Labrador deserves better
It’s time for serious moves toward a $15 minimum wage here in Newfoundland and Labrador. According to provincial government statistics, there are over 12,000 workers in this province relying on the minimum wage. That’s 5.9 percent of the total provincial workforce — a significant number.
A glance at current job postings online reveals that there are even more jobs offering a measly quarter or two above minimum wage. In 2015, two-thirds of those earning minimum wage were women, and while the balance has improved slightly in 2016, nearly 60 percent of minimum wage earners are women.
In February the provincial government conducted public consultations on the idea of indexing the minimum wage to some measure of the rise in cost of living. This could be done by a number of mechanisms, like tying it to the Consumer Price Index (CPI) and requiring automatic increases to the minimum wage as costs rise. The outcome would not be significant—a few cents every few months, most likely—but in a province which currently has one of the lowest minimum wages in the country, every little bit counts.
It’s worth noting that in spite of strong advances to the minimum wage in the early 2000s, this province has in recent years slipped to the back of the pack. At $10.75, we currently have the second worst minimum wage in the country, just three cents more than the worst province for minimum wage, Saskatchewan (where minimum wage is indexed to the CPI, indicating that indexing by itself is no guarantee of a reasonable minimum wage).
Fiscal crises make minimum wage increases more important than ever
Minimum wage is important, especially in a province with as turbulent a labour market as Newfoundland and Labrador. The largest group of minimum wage earners in the province are youth, many of them university students struggling to cover the costs of a post-secondary education, or struggling to break into the labour market after they graduate.
As a result of the provincial government’s funding cuts to post-secondary education, and the tuition fee hikes which Memorial University announced last month, a low minimum wage will stretch less than ever before. According to calculations made by the MUN Students’ Union when the university initially proposed a 16 percent fee hike, it would require out-of-province Canadian students to work 45 additional hours each semester at minimum wage to cover the increased costs of tuition fees alone.
International students would have had to work an extra 93 hours per semester to cover the increased fees. In the end, Memorial University passed an increase of 30 percent in fee hikes for new students, which will more than double the initial projections of how many extra hours students will have to work to cover the new costs. The expectation that students will be able to succeed in their studies while working all those extra hours reveals how ludicrous and poorly thought out Memorial’s fee hikes were.
While students and youth are the largest single group earning minimum wage, they’re not the only ones.
Increases to the province’s unemployment rate mean many decent jobs have been lost, and many of the province’s workers have been forced out of decent-paying jobs and into minimum wage jobs, or have gone back for retraining and joined the student part-time working population while they struggle to gain new skills and rejoin the labour market.
But increasing minimum wage is not only about ensuring people are able to live in dignity and decency. It’s also about strengthening the province’s economy. While some stingy business-owners will balk at the notion of having to pay their employees more (even though study after study has shown that contrary to their paranoia, minimum wage hikes do not kill jobs), the fact is that minimum wage increases are tremendously good for business.
People are only able to purchase goods and services when they’ve got the money to pay for them. Going by 2015 statistics, increasing the province’s minimum wage to $15 an hour would inject an additional more than $60 million into the pockets of Newfoundland and Labrador’s workers and into the local economy (that’s based on the number of full-time minimum wage workers alone; not to mention the benefits this would accrue to the even larger number of part-time minimum wage earners in the province).
This would have a tremendously positive impact on local businesses, in the form of spending on goods and services. And more consumer spending means more job creation, especially in the service industries, reflecting the additional spin-off benefits of a higher minimum wage.
It is precisely when a province is facing a difficult fiscal situation that minimum wage increases become more important than ever, because growing numbers of workers are reliant on minimum wage and the earning floors that it sets, and because minimum wage hikes provide an essential stimulus factor to the economy.
Moreover, given the large number of minimum-wage earners employed by corporations headquartered outside of the province (from retail chains to fast food chains), minimum wage increases help retain money in the provincial economy. Why should we allow the Wal-Marts and Tim Hortons’ and other national and transnational chains to export their profits out of the province, when we could require them to re-invest a larger portion of their profits from local spending back into the pockets of local workers in the form of wages? That money would then stay in the province and benefit the provincial economy and local communities, not the firms of Toronto and New York.
Minimum wage discussions need to be politicized
The provincial government’s minimum wage consultations in February were an interesting beast; we have yet to see what reports or recommendations will emerge from those recommendations. They sought feedback on the idea of indexing the minimum wage to cost increases, not on increasing the minimum wage itself.
As government bureaucrats explained, the notion of indexing the minimum wage had been proposed as a means of depoliticising the minimum wage, of coming up with a formula for raising it automatically so as to avoid the need for messy public debates on the topic in the legislature.
But as it became clear at the consultation hearings, even among those who strongly supported indexing minimum wage (as a way of ensuring it would rise, even a little), everyone was strongly against the idea of depoliticizing it.
Minimum wage debates need to happen publicly, and in the legislature, because they are an essential form of accountability for government and decision-makers. The public—the workers earning minimum wage, especially—need the opportunity to lobby for more decent wages, and members of government need to be held accountable for their decisions to raise, or not raise, the minimum wage. When this province’s minimum wage is almost the lowest in the country, and is so far from a fair living wage, then the minimum wage needs to be politicised, not consigned to bureaucratic formulas.
It’s time for the movement for a $15 minimum wage to take hold in this province. With rising unemployment and an unstable, precarious labour market; with growing income inequality in a province with such high costs of living, and in a province where corporate elites have so long managed to escape having to pay fair taxes, it is imperative for an immediate and significant boost to the minimum wage.
It’s time for Newfoundlanders and Labradorians to pick up the Fight for $15 and Fairness. If Ontario, Alberta, and other jurisdictions can do it, so can we. It won’t eradicate poverty and precarious employment. But it’ll help narrow the gap.
Hans Rollmann is an editor, writer, researcher and organizer with a penchant for chocolate and a knack for limericks.