Right in the centre - Minimal questions
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- Published on Thursday, January 18, 2018
By Ken Waddell
Neepawa Banner & Press
There has been a lot of discussion about the minimum wage being raised to $14 per hour in Ontario. It is scheduled to go to $15 per hour on Jan. 1, 2019. The recent increase was a raise of $2.40 per hour. It has jolted many small business owners and not in a good way.
If the minimum wage in Manitoba were to go to $15 per hour, many businesses would simply close their doors. There isn’t a high enough demand for many goods and services to afford that level of wages. Prices would have to go up or businesses would cut back on employment. Let’s face it, people don’t have to go out to restaurants, they don’t have to buy giftware, souvenirs or extra clothing. It’s called discretionary spending for a reason. It isn’t essential. Consumers could spend less on gas maybe or on restaurant meals.
From the Manitoba employee point of view, a 40 hours a week job at minimum wage of $11.15 per hour comes to $446 per week. At that level, there is no federal income tax, the provincial tax is $6.73, CPP is $15.41 and EI is $7.40. Net is $416.46 per week.
At $15 per hour the wages rise to $600 per week, federal tax kicks in at $10.03, provincial tax at $22.26, CPP at 32.29 and EI at $ 9.96. Net is 534.71.
The increase in take home pay comes to $118.25. Assuming that amount gets spent, the PST and GST comes to $15.37 so the extra cash available to buy stuff is $102.88. That isn’t to be sneezed at and for those who can keep a job or get a job at that rate it is a bit of a step up.
There are things that are harder to measure in this equation. If the essential goods, such as food, go up in price, the extra $102.88 might get absorbed by price increases. When minimum wage goes up, rent could increase as well, gas might go up. It isn’t an easy thing to calculate.
Arbitrary and large increases in minimum wages are not the answer to the bigger questions in our economy. Minimum wage jobs, especially part-time minimum jobs are not intended to be a life-time career. Minimum wage jobs should be starter positions on a person’s path to a long term career. Minimum wage jobs may be suited for high school and university students, for semi-retired people looking for meaningful work and extra income. These positions should be stepping stones on a person’s way to a future career or even to owning their own business.
In Canada, there are a lot of unfilled jobs. Canadian companies bring in huge numbers of immigrants every year to fill positions. In many Canadian communities, there are job openings begging for workers. It is tough in some towns to get on a tradesman’s list to get maintenance and construction work done. Many people can tell you they have been waiting months or longer to get work done. In communities with large anchor businesses, job postings are always out there. The trucking industry has been hungry for drivers.
There are jobs available at all levels of employment. It may sound harsh, but if an able bodied person can’t find work, perhaps they need to see an employment counsellor and actually be prepared to listen.
There is one factor that is very annoying to minimum wage workers and to most people in the so-called middle class as well. That is the level of CEO and upper management wages in corporations and even in government. The high level CEOs have become the royalty of the modern era. In France, in the late 1700s, the poor and oppressed rose up and there was a bloody revolution. In Russia, in 1917, the same thing happened. Arbitrary wage increases, imposed by government aren’t the answer in our economy but the outlandish, lavish and unjustified salaries of our corporate elite (royalty) should also be a cause for concern.
It is pretty cruel to tell a minimum wage fast food restaurant waitress, with very limited access to tips, that she needs to be satisfied with her lot in life when bank and corporate CEOs are earning a 100 times what she does.
Just saying, not advocating a bloody revolution, but a bit of reason and caution would be nice.
