Ontario New Minimum Wage Effects

[Northern Light]

Originally Posted by vid

To add to your excellent post

Thank You.

Even a $15 minimum wage in Toronto doesn't get you very far there.

To this point.

An entry level, one bedroom apartment in Toronto, right now, will set you back $1,550 per month + hydro + parking.

Typically, that would read as $1,670 in spring/fall and a bit more in winter and summer based on window a/c or space heaters adding to costs.

A minimum wage of $15 per hour, for a full time worker, getting 37.5 paid hours per week (most don't get a full hour of paid lunch), works out to $2,250 based on 2 pay cheques for 2 weeks each.

Except, that's before tax.

Very rough math, is that the basic exemptions are close to 13k, so you pay roughly 20% income tax on about $17k, you also lose the health premium and some payroll tax; you'll end up at around 25k net out.

That leaves you $1,923 - $1,670; so you have $253 to survive on each month.

The TTC transit pass is $147 a month.

That leaves you $145 to cover grocery, socks/underwear, clothes, furniture, phone, internet, etc. per month.

Good luck w/that!

I count myself fortunate not to have to make that math work.

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The minimum wage is not the solution to everything, I think $15cdn is probably about right for middle-Ontario for daytime, weekday work.

Adding tax relief targeted at lower income workers, better supports for those w/kids, and truly comprehensive healthcare could make such an existence manageable, if tight.

But in areas like Toronto or anywhere in Ontario where core cost-of-living is more than 20% above provincial norms, I think a higher minimum wage is going to be in order.

It can't be completely disproportionate to the rest of the province, but something extra will be needed.

Perhaps an extra 15%, so that minimum in Toronto would be $17.25 per hour. To make that work, you still need the above discussed tax relief, expanded health care and other supports.

Oregon has done this, have a 3-tiered minimum wage, low-cost rural areas, suburban areas around Portland, and Portland proper.

When fully phased in, on July 1, 2022 min. wage will be $12.50USD $13.50USD and $14.75 USD respectively.

Those numbers in $CDN by the way, at current exchange are:

$16.38 per hour, $17.69 per hour, and $19.32 per hour.

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Something I'd like to see considered here is to borrow from the Australian model and have a premium on the minimum wage for overnight work.

They also have a premium for weekends.

I don't think business could withstand all that changing all at once, but a gradual move where we introduce an urban premium in 2021, then an overnight premium in 2023 would make good sense to me.

Canadians have been too passive in settling for some of the lowest employment standards in the developed world w/low amounts of paid vacation, few statutory holidays, incomplete health coverage and starting wages that are too low.

We don't need to be northern Europe (though why not, as long as I don't have to learn to speak Norwegian) But we really must to better by people who just getting by.

[MrSlippery519]

Originally Posted by vid

I got a 35% increase and added benefits, but we reduced staffing numbers through attrition. (A few guys left and we simply didn't replace them; just got more efficient equipment and gave their wages to ourselves!) No job losses on a wider scale, everyone who left either had a job lined up already or found one within days, we just reduced staffing. I think over time this will continue until it's a few long-time employees supervising robots but such is the economy these days.

How to reflect the increase among existing employees earning wages in the 12 to 20 per hour range was a difficult topic for many businesses and in some cases still is, I've seen a lot of people on Facebook saying shit like "I'm a mechanic and now I'm only making $20 more than a burger flipper!!" but I always tell them, how you feel about what you're paid is something that only you and your employer can truly sort out.

Most of the better run companies do have room to pay their employees more, it depends on how they built their business. If you've grown by undercutting the competition and running a high-volume low-margin operation for a while then yes, the wage increase stings because you forgot to take into account that costs go up over time. But a business that's taken it into consideration and costed their products at a higher labour rate than they actually paid so that wage increases can be taken into account, or situations like a higher paid employee taking over for a lower paid one to keep the operation going (common among us small business types) is going to have a smaller hurdle to him.

Also, this bill was discussed for over a year, everyone knew it was coming, workers were typically ecstatic about it (especially those on the low end of the pay scale) so no employer has a reasonable excuse for not being ready for it. My boss started planning for the wage increases back when they were on the old inflation schedule and weren't planning on getting to $15 until the 2020s, but things change with politics, and most people know that.

No one suggested that at the time, as far as I can recall. Liberal party members might have brought it up while they discussed the policy but for whatever reason they didn't adopt it, likely because they want to take support from the NDP more than the PCs, which was the strategy when the PCs were led by a moderate in Patrick Brown. The Green Party has supported increasing the basic personal amount to $20,000 and increasing minimum wage to a living wave (can't recall if they wanted it province-wide or based on economic regions but I think the latter?) but they're not in the legislature so they get ignored.

But to get back to your point that the government did this to buy votes: what are the PCs doing when they cut income tax? They're also buying votes.

I do not disagree with your points at all, though for some business' it is not as easy as just planning ahead. Thankfully the company I work for does plan accordingly and is very profitable so the min wage increase was not a huge problem, but as I mentioned I do think its implementation could have been done better by the government.

Also nothing wrong with buying votes, it is what it is and certainly all parties do it. Point remains I think a better overall solution to handling minimum and low income families/people would have been an increase to minimum wage along with a personal tax exemption increase as that will also directly affect the amount of money going in someones pocket.



Also one last point your comment about mechanics for example, excellent point if you feel you should be compensated more then you should absolutely bring it up with your company. I think some people "feel" there should make more based on a min wage number when it is not always the case (more so some people over paid while others are underpaid)

[MrSlippery519]

Originally Posted by Northern Light

The minimum wage is not the solution to everything, I think $15cdn is probably about right for middle-Ontario for daytime, weekday work.

Adding tax relief targeted at lower income workers, better supports for those w/kids, and truly comprehensive healthcare could make such an existence manageable, if tight.

But in areas like Toronto or anywhere in Ontario where core cost-of-living is more than 20% above provincial norms, I think a higher minimum wage is going to be in order.

It can't be completely disproportionate to the rest of the province, but something extra will be needed.

Perhaps an extra 15%, so that minimum in Toronto would be $17.25 per hour. To make that work, you still need the above discussed tax relief, expanded health care and other supports.

I think something like this needs to be done, places like Toronto, Vancouver, Montreal, Quebec City (and others I am missing I am sure) would benefit from a structure like this.

I honestly do not understand how some people can even afford to live in Toronto even on an average salary let alone minimum wage.