When any new government takes power, temptations abound to do something different, merely to distinguish itself from the regime it replaced.
The new NDP government in Alberta has indicated that it will aggressively increase the province’s minimum wage from $10.20 to $15 per hour over the next three years.
The B.C. government recently announced it will increase the minimum wage in September to $10.45 per hour. Thereafter, annual increases will be automatically pegged at the rate of inflation.
The BC Federation of Labour is out in full force with its latest campaign to increase the provincial minimum wage to $15 from the current $10.25 per hour.
After several months of labour activists putting pressure on the Ontario government to increase the provincial minimum wage, Premier Kathleen Wynne finally succumbed and announced that she will increase it to $11 per hour from the current $10.25 rate.
What a world it would be if governments could simply legislate higher pay for low-wage workers without any ill effects. But we live in the real world and here public policy should be informed by evidence, not just good intentions. The reality that many labour activists fail to realize is that when governments mandate wage floors, there are real adverse effects. And the people hurt are often the most vulnerable with the least skills.
The minimum wage debate raging in the United States has spilled into Canada sparking renewed interest in government-mandated wage floors. Labour activists are out in full force pushing governments to legislate higher pay for low-wage workers and one version calls on municipalities to decree a living wage law. While these laws may sound like a good idea in theory, they do little to help the most vulnerable workers in practice.
The first of three increases in B.C.s minimum wage kicked in on May 1, and while it will undoubtedly be welcomed by workers currently earning the minimum, its too bad their raise comes at the expense of other workers, who will now be unable to find a job or will lose their job as a result of the wage hike. The unpleasant reality is, minimum wage hikes are a job killer that hurt the very people they are intended to help.