New minimum wage earns minimum praise

Tuesday, April 7th, 2009

Starting Monday, workers earning minimum wage will be making 75 cents more an hour.

The increase, which brings minimum wage to $8.75 an hour, is part of the provincial government’s anti-poverty initiative.

“Increasing the minimum wage is a key component of the McGuinty government’s plan to reduce poverty in Ontario by expanding economic opportunity for hard working families,” Labour Minister Brad Duguid said in a press release. The ministry could not be reached for further comment.

The current boost is not enough according to Sonia Singh, organizer at the Workers’ Action Centre, a worker-based advocacy group.

She explained although the government says the increase will benefit hard-working families, it would still leave them $4,000 below the poverty line. Even at $8.75 an hour, individuals working a 40-hour week will still be struggling to survive.

“No one should be working and living under the poverty line in a province like Ontario. It is unacceptable,” she said.

She would like to see the government reach the goal of bringing minimum wage to at least $10.25 an hour "" the current poverty line in big cities " and continue to index wage to inflation.

Kul Bhatia, a professor of economics at Western, believes the current increase will be very good for students and other low-wage earners. “Minimum wage has not kept up with changes in the cost of living,” Bhatia explained.

Singh agreed the increase would help students, she felt the problem went well beyond the needs of students, citing the one million-plus low-wage workers making less than $10.25 an hour in Ontario.

Singh and Bhatia agreed an increase of that magnitude would have a minimal effect on employers, with the availability of jobs being minimally impacted.

However, Morley Gunderson, an economics professor at the University of Toronto, said the Ontario economy is under a lot of a stress, and now is not the time to introduce a minimum wage increase.

Gunderson expressed concern the increase would have an adverse employment affect and reduce job opportunities.

He also explained the working poor often make slightly more than minimum wage, and it will be mostly young workers and students who would be affected.

Saskatchewan has set the goal of increasing minimum wage to the line of poverty, and Nova Scotia is looking into a similar initiative.

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