MINIMUM WAGE - CANADABY: PAUL YOUNG, CPA, CGA

MINIMUM WAGE

• There is lots of talk about minimum wage in Canada. Many political parties discuss the need to hike both the federal and provincial minimum wage. This presentation will discuss issues the impact on changing the minimum wage in Canada.

COMMENTARY

• CLC has charmed in to say there is 100,000 workers that are paid minimum wage - http://canadianlabour.ca/news/news-archive/why-canada-needs-federal-minimum-wage

• It does seem the NDP is using CLC numbers, but they do not align with stats - • Source - http://www.ctvnews.ca/politics/fact-check-ndp-and-liberals-on-the-15-minimum-wage-1.2517664 • Source - http://thetyee.ca/News/2015/08/11/NDP-Federal-Minimum-Wage/. NDP source says it 100,000 worker, but no stats

to back up claim. We all know the NDP inflate their numbers to look good to their sheep• Source -

http://globalnews.ca/news/2151323/reality-check-does-the-ndp-minimum-wage-plan-leave-out-99-of-minimum-wage-earners/

 • We all know the “100,000 level” was done on purpose to play to low informed voter! It seems my sources

which includes about 5 have a different take than CLC. CLC is labor group so we all know they will push pro-NDP policies including skewing the numbers

FEDERAL MINIMUM WAGE / MINIMUM WAGE

http://www.retailcouncil.org/quickfacts/minimum-wage

MINIMUM WAGE

http://www.statcan.gc.ca/pub/11-630-x/11-630-x2015006-eng.htm

• When the minimum wage goes up, the proportion of employees paid at minimum wage may increase. This is because some employees who were earning above the minimum wage join the ranks of those earning the minimum wage.

• In 2014, as in 1997, youth, women, students and people with a lower level of education were the groups most likely to be paid at minimum wage. In 2014, 49% of employees aged 15 to 19 years and 15% of those aged 20 to 24 were paid at minimum wage. The rate for women was 9%, compared with 6% for men. Among students, 29% were paid at minimum wage, versus 5% of non-students. Lastly, 20% of employees with less than a high school diploma were paid at minimum wage, compared with 3% of employees who had a university degree.

• When the minimum wage goes up, the proportion of employees paid at minimum wage may increase. This is because some employees who were earning above the minimum wage join the ranks of those earning the minimum wage.

• In 2014, as in 1997, youth, women, students and people with a lower level of education were the groups most likely to be paid at minimum wage. In 2014, 49% of employees aged 15 to 19 years and 15% of those aged 20 to 24 were paid at minimum wage. The rate for women was 9%, compared with 6% for men. Among students, 29% were paid at minimum wage, versus 5% of non-students. Lastly, 20% of employees with less than a high school diploma were paid at minimum wage, compared with 3% of employees who had a university degree.

• Who make up minimum wage earners?

• We sought to answer this question in a recent Fraser Institute study, using data from Statistics Canada. The results may be surprising for minimum wage advocates. Specifically, we found that:

• • 88 per cent of minimum-wage earners do not live in a low-income household, as measured by Statistics Canada’s low income cut-off (LICO).

• • 83 per cent of workers living in a low-income household earn more than the minimum wage.

• In other words, most Canadians who earn the minimum wage are not “poor,” and most of those living in “poor” households earn more than the minimum wage. For a government policy aimed at helping the working poor, the minimum wage simply does not efficiently or effectively target the people it is supposed to help.    To help explain these results, we looked at some of the other characteristics of minimum-wage earners including their age, education, and more. Here is what we found:

• • 58 per cent of minimum-wage earners are teenagers or young adults aged 15 to 24, with the vast majority of them (85 per cent) living with their parents or other relatives. For many youths, a minimum wage job is their first while in school and often a stepping stone to higher paid employment.

• • 54 per cent of minimum-wage earners have achieved a high school diploma or less, signalling very low levels of education. If we focus on all workers who hold a university degree, then only 3 per cent earn the minimum wage. This should put to rest the idea that a substantial share of university graduates is working minimum wage jobs.

• • 58 per cent of minimum-wage earners work part-time. More broadly, however, part-time workers are much more likely than full-time workers to be earning minimum wage. Consider that just 4 per cent of all full-time workers earn the minimum wage, challenging the notion that a large cadre of full-time career workers is dependent on the minimum wage.

• • 20 per cent of minimum-wage earners have an employed spouse, meaning there is more than one earner in the household. And the vast majority of their spouses earn more than the minimum wage.

• • Just 2 per cent of minimum-wage earners are single parents with a young child, diffusing the misperception that minimum-wage earners are generally single parents struggling to survive.

• The facts paint a surprising picture of the typical minimum-wage earner in Canada: a young person, usually living with parents or other relatives, while often in school and working a part-time job.

• If the goal is to help the working poor, raising the minimum wage is at best a very crude method since it poorly targets those in need. At worse, can produce harmful economic consequences by reducing job opportunities for low skilled workers.

•  

https://www.fraserinstitute.org/blogs/the-typical-minimum-wage-earner-in-canada-not-who-you-think

NDP POLICY

WHO ARE FEDERALLY REGULATED

STATS / MINIMUM WAGE

WAGES

Source – Stats Canada

IMPACT ON FEDERAL MINIMUM WAGE

IMPACT OF MINIMUM WAGE

IMPACT OF MINIMUM WAGE

ALBERTA MINIMUM WAGE HIKE

ALBERTA MINIMUM WAGE HIKE

ALBERTA – MINIMUM WAGE

• http://www.cbc.ca/news/canada/calgary/alberta-minimum-wage-restaurant-group-wants-exemptions-1.3107969• http://www.cbc.ca/news/canada/edmonton/15-minimum-wage

-worries-retailers-restaurants-small-business-1.3110431

SKILLS GAPS

OTHER SOURCES

• Poverty - http://www.slideshare.net/paulyoungcga/poverty-and-low-income-Canada