Starting Saturday, the minimum wage in Saskatchewan is going from $11.81 to $13 an hour. But some experts and community leaders say that won’t be enough, with inflation fueling the rising cost of living.
“It’s going to take a while to catch up with the cost of living,” said Darrell Mills, a minimum-wage worker in Saskatoon, noting that his gas and food expenses are rising.
“If you’re raising children or trying to go to school, it’s very difficult.”
Andrew Stevens, a business professor at the University of Regina, said that although the salary is increasing, “unfortunately, we are still at the bottom of the list compared to other provinces”.
With Manitoba also raising its minimum wage on Saturday — up to $13.50 an hour — Saskatchewan now has the lowest wage in the country.
Saskatchewan’s minimum wage will increase further on October 1, 2023, to $14 an hour and $15 an hour in 2024 — something the Saskatchewan Party government stated in a press release will increase by 89% compared to 2007, when the minimum wage in the province was $7.95.
Stevens said that although the percentage increase is “substantial”, the increase in housing, food and energy costs “will exceed the [wage] the increase that residents will receive.”
“Raising the minimum wage won’t be a silver bullet,” Stevens said.
“If we really look at wages and salaries as a way to raise low-income status or [getting people] out of poverty, it has to be more comprehensive than just a dollar figure attached to it.”
He published an article in 2017 that argued for a $15 minimum wage in Saskatchewan, and urged workers to challenge business models that rely on low wages.
“If we had raised the minimum wage to $15 in 2017, more than 90,000 workers would suddenly have seen their wages increase. That would have been significant,” he said.
“The assumption is that minimum wage earners are a bunch of teenagers living in their parents’ basement. That’s an oversimplification. We know that middle-aged people [people] and seniors also work for minimum wage.”
Stevens said women are also disproportionately represented in the ranks of minimal workers.
Higher wages would financially empower adults working in hospitality, services, groceries or cleaning, he said — people often called “heroes” at the start of the COVID-19 pandemic, but who have since “ironically been forgotten”.
“When we talk about raising the minimum wage, we hear these dire statements that it will have an economic impact. It’s a misconception that it will create hardship for small businesses,” Stevens said, adding that some small businesses of Regina have been strong supporters of living wages.
But for Sheikh Kamal Ahmed, owner of a grocery store on Saskatoon’s 22nd Street, a minimum wage increase for his three employees will increase his operating expenses.
“Small business owners are still struggling”
Ahmed said costs were rising to import shop items from Bangladesh, India and other South Asian countries.
“There’s a 20-30% increase from the supplier,” he said. “But we can’t raise prices for the merchandise because customers won’t pay as much.”
Its utility and rent prices are also affected by inflation, he said.
“With the minimum wage going to $15 an hour, this will have an additional impact on our business. »
Brianna Solberg, senior policy analyst at the Canadian Federation of Independent Business, said only half of Saskatchewan small businesses said they had returned to pre-pandemic sales levels.
Based on data from CFIB, which represents more than 4,300 small businesses in the province, Solberg said most small business owners said they raised their prices to customers more than usual over the past year to offset rising costs. Of these, a large majority “indicate this is due specifically to rising labor costs,” she said.
“This minimum wage hike comes at a time when small business owners in Saskatchewan are still struggling to get back on track in the wake of the pandemic. »
She said raising the minimum wage will incentivize employers to “raise wages for employees, even for those already earning above the minimum.”
The Federation asked the provincial government suspend small business tax collection until more businesses have had a chance to recover, and drop out a PST extension which is also in effect from Saturday.
“Small businesses are already raising wages above the minimum to attract labor, but shortages persist,” Solberg said, adding that CFIB favors incremental increases rather than a significant jump.
This month’s minimum wage increase, and those scheduled for 2023 and 2024, mark a break from the indexing formula the province previously used to determine rate changes.
“We hope the government remains committed to returning to its indexing formula when the minimum wage hits $15 in 2024,” Solberg said.
But Peter Gilmer, an advocate with Regina’s anti-poverty ministry, disagreed, saying neither $13 nor $15 was enough.
Quoting a report by the Canadian Center for Policy Alternatives, Gilmer said maintaining a decent standard of living requires wages of $16.23 an hour in Regina and $16.89 an hour in Saskatoon.
“While indexing is important, poverty should not be indexed,” he said.
“The living wage is the quintessence”
Gilmer said years of very low minimum wages and current inflationary pressures will bring together many choices that many households already face.
“Raising the minimum wage to a living wage will ensure that basic needs are met, which is certainly not the case now, and it would reduce emigration” from Saskatchewan to other provinces, he said. declared.
“The province should be more aggressive in providing greater wage security to low-income workers. A strong wage policy movement toward a living wage creates greater equity for marginalized groups like Indigenous peoples and visible minorities who fall into that equity gap,” Gilmer said. .
“A living wage is the epitome of reducing deepening poverty in Saskatchewan. We argue that this is a fundamental human right to which the provinces have committed under international law.
According to data cited in a 2021 Campaign 2000 reporta national coalition of organizations working to end poverty in Canada.
Gilmer said while $13 is a “small move” in the right direction, it will still leave the minimum wage “well below a living wage.”
“There is still a long way to go towards ending poverty and minimum wages cannot be the only answer.”