UPDATED: More On The Minimum Wage

There has been very much a predictable reaction from business to the Wynne government's decision to raise the Ontario minimum wage to $11 per hour as of June 1. Even though this modest increase will do little to lift the working poor out of poverty, the commercial sector is running about shouting that the sky will fall, prognosticating a loss of jobs as they take up a defensive position against something that will, they claim, eat away at their profits.

The following video from City TV offers a smattering of a debate over the issue; unfortunately, I no longer seem able to play video from the CBC, where much more detailed discussion has taken place, so this will have to do. Following the video, I turn to Joe Fiorito's latest observations about working poverty as his column today returns to the story of Doreen, whom I discussed yesterday.

As noted previously, Joe Fiorito has pointed out what a hardscrabble existence Doreen, a personal care worker, leads. Today, he adds to that portrait:

She said, “I broke my glasses last July. I can see, but fine stuff I can’t read.” You guessed right. She has not replaced her glasses. This is the kind of poverty that hurts deep in the bone, dulls the senses, and strangles hope. She has not stopped trying.

Compounding Doreen's problems are the expenses involved in keeping her qualifications current; she recently received a letter from one of the agencies for whom she is on an on-call list:

The letter advised Doreen that, if she wanted to stay active on the agency’s list and be eligible for work in the future, then she had to renew her first aid and CPR certificates.

Trouble is, the course preferred by that agency costs $115 and is only offered on weekends. Doreen works on the weekend for an elderly couple. What this means is that, in order to take the course and renew her certificate, she would have to cough up a day’s pay out of pocket to attend, and she would have to miss two days’ work on top of that.

There are more details about Doreen's travails in Firotio's piece, but I think you get the picture.

As I suggested yesterday, unless and until we are willing to put a human face on the working poor, their plight will never be addressed with any real justice.

UPDATE: Andrew Coyne and business representatives have recently suggested that minimum wage increases are a blunt instrument with which to attack poverty, and that a guaranteed income might be preferable. The cynic in me suggests this could be yet another way that business wants government to subsidize their operations; should they ever express a willingness to give up some of the generous corporate tax cuts that have come their way over the past several years as a show of good faith, perhaps then I will take them seriously.

Self-Interest Versus The Public Good

We Canadians talk a good game. We want our unemployed to be able to find jobs, we want those with the need to be able to readily access the social safety net, and we think the plight of the working poor is pitiable. But a question that we must confront is this: Are we willing to put our money where our mouth is?

My question is prompted by two topics: the decline of the Canadian dollar and the push to increase the minimum wage to $14 (in Ontario).

First, the decline of the loonie. Even though its decreasing value is likely being encouraged by the Harper government to boost employment numbers going into the 2015 election, the fact is that a lower dollar is good for job creation, increasing as it does exports of our products and tourism from abroad.

Yet what seems uppermost on the minds of many? - the fact that imported goods will cost more, trips to sun destinations so popular with chilled Canadians are getting more expensive, and cross-border shopping trips will no longer be such a source of delight for so many.

This is just a thought experiment, but I can't help but wonder what choice people would make if they had the power to affect the trajectory of the Canadian dollar. Would they see the larger good that will be served by its current decline, or would they say that's none of their concern, and that their priority is to get the most value for their hard-earned dollars?

On a similar note, we profess our enthusiasm for a significant increase in the minimum wage, a subject upon which I have written many times. Indeed, there is some good news on that front from the United States, where, for example, Seattle's new mayor, Ed Murray, has boosted the wages of municipal workers to $15 per hour, and Seattle's suburb of Sea Tac has done the same for the 1,500 hotel and rental car agency workers.

Putting aside the usual objections raised by the usual suspects that wage increases are job-killers, there are compelling reasons for increasing the minimum wage, not the least of which is the boost to the economy that ensues when more money is put in the hands of more people. As an entrepreneur in the documentary Inequality for All says, "Just because I make $10 million a year doesn't mean I spend $10 million a year on goods and services. It's better that money should be put in the hands of many people so they spend." He went on to explain that his money is invested to earn more money, not necessarily to create jobs.

Add to that the fact that, for example, raising the minimum wage in Ontario to $14 per hour would put raise the working poor 10% above the poverty line, assuming, of course, that they are working 35-40 hours per week. Economic stimulus effects aside, that is a pretty compelling reason to support an increase.

But returning to our thought experiment, what choice would people make if they knew that any such increase means we would all pay a little more for our groceries, our fast foods, our services, etc.? Would we turn our collective backs on the greater good, or would we embrace the fact that everyone has to make some sacrifices, both business in the form of slightly lower profits and consumers in the form of slightly reduced purchasing power, if we want a more equitable society and a slightly lower disparity in incomes?

We all like to get the best value possible for our money, and I am no exception. Yet, even though I am hardly a paragon of virtue, the logic of increasing the minimum wage is compelling, one to which I readily accede.

More Thoughts On The Minimum Wage

Although I have written several previous posts on the need to substantially increase the minimum wage so that it becomes a living wage, I have been planning an update. However, I doubt that today will be the day for that update since, once again over my morning coffee, I have come across two thoughtful letters in The Star that I feel compelled to share with you.

Although the first letter looks at the poverty pervasive in Toronto thanks in no small measure to the current Ontario hourly minimum of $10.25, the second looks at the broader provincial consequences of such paltry remuneration. I am sure that similar conditions prevail in the rest of Canada.

And, as letter-writer McAdam asks, Where is the report by Ontario’s Minimum Wage Advisory Panel? My suspicion is that Premier Wynne, with a spring election likely, will be sitting on it for a long, long time unless she is that rare, almost extinct breed of politician capable of real leadership.

Re: Time to give poorest a raise, Editorial Jan. 16

There are lots of social and public policy ideas that we can afford to take our time and have a full and long debate about before moving ahead towards a solution, but raising the minimum wage should be a no-brainer. Those who oppose raising the minimum wage to a living wage, like Tim Hudak or the Fraser Institute, obviously have neither the head nor the heart to reach this sane conclusion.

You simply cannot afford to live and eat in Toronto on a minimum wage salary, and those who are trying to do so are getting sick because of it. That’s the information provided by the brave doctors and other medical professionals who are finally speaking the truth about the impact of a society that pays its CEO millions of dollars a year while thousands of our citizens are working hard every day just trying to survive. This is income inequality in its rawest and most brutal form and anyone who condones this situation is complicit in allowing it to continue.

This is one issue that we can begin to fix today by raising the minimum wage. It will not take people completely out of danger, but it will be a sign that we still recognize and reward hard work in our society. And it will be a step in the right direction.

We will need to do much more, like taxation reform to make our system fairer, increased support for seniors, and much more investment in training and development of our young people. We can take some time and talk about those long-term solutions. But raising the minimum wage is urgent.

Katie Arnup, Toronto

The Star points out a few of the huge costs from Ontario’s poverty-level minimum wage, including damage to one’s health, as doctors and other health care providers have noted, besides the hardship and frustration of poverty. But there are many other harmful impacts.

Some 375,000 Ontarians must rely on foodbank handouts to ward off hunger. Recent studies show that about 11 per cent of food bank users in Ontario are employed, but must turn to foodbanks because of their low earnings. Imagine the thousands of volunteer hours devoted to survival programs such as these.
And what about the frustrations for families in which parents must work two minimum-wage jobs in order to make ends meet, and who thus have little time to spend with their children?

My wife teaches many low-income students in Toronto’s Flemingdon Park neighbourhood where this situation is all too common. She sees the emotional price that her students pay when their parents are missing in action, because of overwork and fatigue.
The Star rightly asks: where is the report by Ontario’s Minimum Wage Advisory Panel? When I presented to the panel last fall, a staffperson told me that its report was expected by December. Where is it?

What kind of society tolerates a situation in which hard-working people must still endure poverty? The plight of low-wage workers is a vital issue that should figure prominently in Ontario’s public life, especially as a provincial election approaches.

Anglican Church members across the GTA and surrounding region are currently debating a proposal to raise the minimum wage in two stages to $14.50 per hour by 2015, above the poverty line. If we all raise our voices, we can improve the lives of our society’s poorest paid workers.

Murray MacAdam, Social Justice & Advocacy Consultant, Anglican Diocese of Toronto

But I Save so Much Money Shopping There!

For the true cost of those bargains that we all slavishly delight in (cue Pavlov's dog), you might want to read this article about Walmart workers and watch the video below. As well, a recent post by Dr.Dawg is instructive.

So They Really Do Care After All

This story should lay to rest any of the insidious propaganda about Walmart not caring about its workers.

A Monday Morning Thought