Full-time Work Should Lift You Out of Poverty

Labour Council President Marc Xuereb had this column published in The Record on March 7, 2014. See original at http://www.therecord.com/opinion-story/4399344-set-ontario-s-minimum-wage-even-higher-to-reduce-poverty/.

On January 30th, Ontario Premier Kathleen Wynne announced her government’s intention to raise the minimum wage to $11/hour and index it to inflation. While this is a step in the right direction, I know that our prosperous province can do better.

Even the NDP’s proposal, announced just last week, to raise the minimum wage to $12/hour by 2016, will leave people working full-time at the minimum wage at 12% below the Statistics Canada Low Income Measure.

There is a reason that the Campaign to Raise the Minimum Wage set $14/hour as its target. A person making $14/hour full-time lives 10% above the poverty line. Isn’t it a reasonable proposal that if you work full-time, you should not have to live in poverty?

The Ontario labour movement certainly thinks so.

The Waterloo Regional Labour Council was approached by two local anti-poverty groups last fall to ask for our support for the campaign. The Labour Council delegates – representing unions with a collective membership of 26,000 workers in Waterloo Region – voted unanimously to endorse it and to contribute financially to the campaign.

I was very proud of this decision, because it showed that unions care about more than just the welfare of our own members. Almost no unionized workers make less than $14/hour, yet the union movement has spent significant resources to draw attention to this issue.

This past Family Day weekend, the Ontario Federation of Labour organized a massive demonstration in downtown Toronto that brought tens of thousands of people to the streets demanding a $14/hour minimum wage and indexing it to inflation.

My personal experience tells me that most people agree with labour’s position. I spent a couple of hours on a cold Saturday last December talking to people at Fairview Mall about the $14/hour proposal, and received overwhelmingly positive responses from people. I joined about a dozen activists distributing candy canes and postcards to Christmas shoppers with the message “Santa’s Elves Need a Raise”. The offer of a candy cane made most people stop as they hurriedly made for the mall doors to escape the frigid cold, and I was pleasantly surprised how positively almost everyone responded to my short speech about our campaign. “It’s about time,” “Good for you,” and “I’ll fill out the postcard” were typical comments we received.

Some people worry that small businesses wouldn’t be able to pay the higher minimum wage, or that employers will just offer fewer jobs or shifts to balance the higher wages. But the reality is that almost half of all minimum wage jobs in Ontario are with businesses with more than 500 employees. Pizza Pizza, McDonald’s, and WalMart can afford to pay more.

Further, academic research has found that minimum wages increases did not lead to job loss over the past two decades. Ontario added almost 150,000 jobs to the sales and service sector between 2006 and 2012, the very period in which it increased its minimum wage from $7.75 to $10.25.

Why did the service sector create jobs despite a rising minimum wage? Because low-income earners are far more likely than the rich to spend their extra dollars on basic necessities in the local economy. They spend money in the very businesses that employ them, enabling the businesses to employ more people.

With a provincial election likely just around the corner, now is the time to raise our voices in support of a $14/hour minimum wage. See www.raisetheminimumwage.ca to join the campaign.

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