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DEBUNKING MINIMUM WAGE MYTHS: WHY WE NEED A RAISE
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by
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November 23 - 29, 2006 |
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With minimum wage legislation making its way through both the
provincial and federal government, what constitutes a living wage
is once again at the forefront of discussion. Those in the private
sector maintain that increasing the minimum wage to $10 an
hour benefits no one and hurts businesses. But are their concerns
really all that they seem? Those on the inside of the poverty
debate feel the reasons for keeping minimum wage static are
misleading and that Canadians are long overdue for a raise.
“The misconception is that these are maybe students that
are working in part–time jobs or they’re young people or that they
are secondary wage, a little bit of pocket money,” says Sandy
Shaw of the Social Planning and Research Council in Hamilton.
“That’s absolutely not true. People are trying to, in this
community, raise families on minimum wage jobs and they’re
living in poverty.”
Statistics Canada says that nearly half of those in low–wage
work (defined as $10 an hour or less) are their family’s primary
income earner and that one in seven of those who work full–time
do so at minimum wage. However, long hours don’t guarantee a
ticket out of poverty. In fact, those who put in a 40–hour work
week at minimum wage in Ontario still fall a few thousand dollars
short of the Low Income Cut Off for most cities.
Today’s minimum wage, when adjusted for inflation, hasn’t
kept pace with rising housing and utility costs. “In Ontario,
basically a $10 an hour minimum wage would recover that which
has been lost over the last decade–and–a–half or so,” says John
Clarke, an organizer with the Ontario Coalition Against Poverty.
“We’re talking about a measure to go back to how things used to
be essentially.”
Proponents of a minimum wage that’s a living wage observe
that it’s not just those at the bottom of the pay scale that have a
tough time getting it together. “There are a large number of jobs
that are between the minimum wage and $10 an hour, these low–
wage jobs that, while they may not be at minimum wage, they’re
just slightly higher and just slightly higher puts you below the
poverty line,” says JoAnne Frenschkowski a staff lawyer with the
Income Security Advocacy Centre.
Frenschkowski says the days of taking a starter job with low
pay in order to move up the company ladder don’t exist anymore
and it’s a big reason so many people fall into the low–income
category, sometimes permanently. “A job, any job, isn’t
necessarily going to mean that you improve your situation,” she
points out, noting that in the lower income brackets, job changes
are often lateral career choices. “There’s no progression there
anymore. The leap that you have to make is a lot larger.”
Critics of raising the minimum wage point to self–
improvement, such as education, as the key to moving up the
social ladder. However, Clarke feels that the prevalence of low
wage work has more to do with market forces than any sort of
individual initiative. “Society allocates a certain number of spaces
to people who are going to be well–paid workers and people who
are going to be low–paid workers,” he says. “Even if you could
wave a magic wand and place into the cranium of every low–wage
worker and, for that matter, every person on social assistance a
level of academic prowess that made them supposedly
marketable items in the job market, all you would simply do is
achieve a situation where you’d have better educated poor
people.”
The provincial Liberals maintain they’ve done their part to
raise Ontario’s minimum wage, which has gone up three times
since 2004 and finally settles at $8/hour this February. However,
many contend that while these increases are good, there’s still a
ways to go. “The McGuinty government is raising the minimum
wage, but at the same time it has been seven years without a
raise,” says Shaw. “There’s a lot of ground to make up.”
Contrary to private sector concerns that higher wages will
kill jobs off in droves, Harry W. Arthurs’ recent report for the
Canadian government supports the opposite conclusion. He
found that for every ten per cent increase in minimum wage, the
labour market experienced a one–three per cent job loss,
primarily amongst young workers in the service industry. He also
concludes that the economic downside to higher minimum wages
is outweighed by the social benefits. “Most [Canadians] would be
willing to pay just a little more if doing so gave their neighbour or
fellow worker or the person who serves them in a restaurant the
chance to lead a decent life,” he said in the report. “People who
live in poverty do not have that chance.”
That there’s even a debate about bringing the working poor
up to the poverty line shows how widespread the misconceptions
surrounding minimum wage are. If the marketplace isn’t willing to
pay a living wage, perhaps it is the government’s place to step in
and ensure economic justice for working Canadians.
“This low wage economy is a public policy decision,” says
Shaw. When it comes to getting ahead, she says poverty isn’t just
an individual’s fate; the government also plays a role. “This is
legislated poverty.” V
[SARAH VEALE]
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