Minimum Wages

[Thorin]

Okay, so I was looking up the Alberta minimum wage to figure something out - it's the lowest in Canada at $9.40 an hour.  I was on Wikipedia and clicked a See Also link that led me to the US minimum wages: http://en.wikipedia.org/wiki/List_of_U.S._minimum_wages

Here's some that really stick out to me:

Georgia - 5 or less employees, no minimum wage; workers getting tips, $2.13
Iowa - small companies grossing less than $300k per year, no minimum
Massachusetts - workers getting tips, $2.63; agricultural workers, $1.60

There are other terribly-low numbers in there.  Remember that people also have to pay for their own health insurance out of that money.  No wonder Americans don't want to do the @%&# jobs anymore, they'd make less than Al Bundy!

[Mr. Analog]

It's a sad state of affairs, cost of living has risen dramatically but for many regions of the US the minimum wage hasn't shifted at all.

[Lazybones]

Can't remember if it was BC or Alberta but there was a similar distinction for workers service alcohol or something.

Minimum wage is very regional.... I wonder what the cost of living to minimum wage ratio is more than what the minimum is.

[Thorin]

Alberta is $9.40 per hour except for $9.05 per hour for those that serve alcohol (cocktail waitresses).

$1.60 an hour is $12.80 a day.  Keep in mind they pay their own health insurance, $300 a month or more.  $1.60 an hour doesn't even cover health insurance, even if you live in a cardboard box and eating out of dumpsters.

[Lazybones]

Alberta is $9.40 per hour except for $9.05 per hour for those that serve alcohol (cocktail waitresses).

$1.60 an hour is $12.80 a day.  Keep in mind they pay their own health insurance, $300 a month or more.  $1.60 an hour doesn't even cover health insurance, even if you live in a cardboard box and eating out of dumpsters.

Not really disputing 1.60 as ridiculous, however when speaking about minimum wage relative cost is important..

[Darren Dirt]

Not really disputing 1.60 as ridiculous

That's less than Yoda!
http://what-if.xkcd.com/3/

[Thorin]

Yes cost of living is important for relative comparisons.  New York City is unlivable on minimum wage unless you squeeze eight people into a one-bedroom apartment.  As they do.  I really can't imagine living with eight people in a one-bedroom apartment with no AC and nowhere to send the kids but out on the street.

[Lazybones]

Yes cost of living is important for relative comparisons.  New York City is unlivable on minimum wage unless you squeeze eight people into a one-bedroom apartment.  As they do.  I really can't imagine living with eight people in a one-bedroom apartment with no AC and nowhere to send the kids but out on the street.

Exactly, even places with seemingly high minimum wage could be worse to live in. There are "living wage" stats for many places that make for a much clearer picture of things...

[Darren Dirt]

When a state or province decides to force a RAPID increase in minimum wage, they don't seem to let facts get in the way...

Not just Alberta's NDP, but Ontario's Liberals.

All apparently in the name of helping mostly part-time and young unskilled workers be able to buy a little more stuff (until the price of that stuff goes up 20%, 30%, or more...


Today I found this article on the Ontario minimum wage boost (+32% over 18 months) in the unquestionably-left-leaning Huffington Post.

Middle of next year Alberta should be seeing a lot of similar articles written... and not just from the "right wing" voices either.


http://www.huffingtonpost.ca/john-laforet/wynnes-tiny-tax-cut-wont-save-small-businesses-from-15-minimum-wage_a_23290708/

"
...those small businesses that rely on minimum-wage workers as part of their business model will need to adapt by:
-Maximizing employee productivity to get more value out of more expensive employees;
-Reviewing (and adjusting) their financial plan and model to fit their new cost structure;
-Growing their sales to increase volume of work and employee utilization; and
-Adjusting pricing of products and services, if that's all there is left to do.

Absent of the resources to take an honest look at employee processes and productivity, many businesses won't be able to make educated decisions about how to maximize their workforce and will instead look at how best to cut the number of hours they staff,
Others will try raising prices in place of increasing volume and will find their better-resourced competitors eating their lunch anyways, even with improved margins.
"


A few noteable comments:


If a business fails due to the minimum wage increase then it was bound for failure long before this.


That doesn't make any sense. That's like saying "If a restaurant can't afford a 30% increase in food costs, they were bound for failure!".


A 32% increase in under 18 months is not sustainable for all small business.  Could you afford a 32% increase in your mortgage in 18 months?  Because if you can't maybe you shouldn't have a mortgage.  Your comment sounds as silly as mine eh?


I am a landlord who owns a building that houses a successful bakery and cafe.  They have been tenants for 20 years but notified me this week that they are closing because they won't be able to afford the minimum wage hike.  All those poor employees expecting a wage increase in January will now get pink slips.


The huge spike in cost of goods coming could likely counter any gain in spending. The only real winner in this is the Ontario gov through increased tax revenues.


When businesses have added expenses, the product or service they are selling goes up and/or their expenses (labourers) are decreased.
This solution will be great for a short time but will eventually go back to equilibrium when the cost of living catches back up to the increase of minimum wage.

[Darren Dirt]

Another similar HuffPo article from Dec.2014, again HuffPo
http://www.huffingtonpost.ca/charles-lammam/canada-minimum-wage_b_6257812.html

(surprising how the comments here were so skeptical of the claims/arguments even though there were links to the source studies etc... and yet the above Nov.2017 article has a lot more agreement with the same conclusion -- quickly increasing MW is the wrong solution for a legitimate problem aka "poverty". I guess during these past 3 years the mainstream media has covered some noteable related "real life tests" of help-the-poor economic policies that publicly failed, such as Venezuela and Seattle?)



"
While the aim of helping poor families is something we all want, the reality is that a minimum wage increase is the wrong policy.

It sounds straightforward: get the government to legislate a higher wage so low-wage workers earn more. Unfortunately, this oversimplification fails to account for a number of facts including who earns the minimum wage and the unintended consequences that result from minimum wage hikes.


First, most people who earn minimum wages are not the sole income earner in their household. Most are in fact young people starting out in the labour force working their first job while in school. A large share of the remaining minimum wage earners (17.4 per cent) have working spouses, meaning their household income is higher than what a single minimum wage would provide.

This basic data on minimum wage earners helps to explain why academic studies consistently find that minimum wage increases do not reduce poverty.

The economics of studies is relatively straightforward. When governments impose a minimum wage higher than what would otherwise prevail and without corresponding productivity increases, employers find ways to operate with fewer workers. While the more productive workers gain through a higher wage, their gain comes at the expense of others who lose as a result of fewer employment opportunities. Young and low skilled workers are most adversely affected since they possess less job qualifications and experience.

In the end, minimum wage hikes rob young people of the opportunity to gain work experience that helps them develop basic skills and earn higher levels of income.
"

[Thorin]

If you want to have a discussion about this, maybe start by posting your opinion and supporting info, instead of just posting comments from links? I mean, when you just post comments from others like this, it's been my experience that no matter what opinion I state, you then argue the other side...

[Tom]

Yeah, I'd like to make some comments, but I'd feel it'd be like talking into the void.

[Darren Dirt]

I thought my position was clear from the beginning of both of my posts.

I am open to claims and policies being pushed if there is testable repeatable evidence backing it.

I have read the GoA's webpage and skimmed its links in support of a rapid increase to MW. It seemed less facts and more promises so was less than convincing but whaddaryagonnado.

Then yesterday unexpectedly found a HuffPo article dated that day about MW. It was related to Ontario but similar, only it was dealing with a reality and most of the comments were not in favor of what the Ontario government was doing... which surprised me because HuffPo is very left leaning so the lack of pro-MW-boost comments was noteable imo.

Both of the HuffPo articles linked have sources for their opinion. I skimmed them as well and they seem to me less speculative and anecdotal than the government justifications.

Would you like me to find the provincial governments' webpages that have plenty of links on the pro side? Those are easy to find, unlike a con side on a left leaning media site hence my share.

[Tom]

What is the percentage increase on the ab minimum wage per increase? I'm pretty sure they've been doing it in steps.

That said, if you're paying your workers purely minimum wage, you really don't respect your people. it is NOT a living wage.

[Mr. Analog]

The trouble I have with a lot of US journalism (and online echo-chambers) is that they'll both pull stats for inflation and minimum wage, so-called "living wage", cost of living per region (etc) and draw completely polar conclusions (for reference see any discussion on Seattle's local economy ever). At the core though is this question;

Is it possible to survive on minimum wage alone?

General minimum wage in Alberta is (as of Oct 1, 2017) $13.60/hour, now assuming a person can even get a full 40 hours a week that means $544/w, or $28,288.00/a but this isn't take home of course.

Of that $544 per week...

Federal tax: $39.77
Provincial tax: $15.21
CPP: $23.60
EI: $8.87

Total deductions: $87.45
Net pay: $456.55 (per week)

Again, this all assumes a steady, 40 hour a week minimum wage job.

According to this CMHC article, (in 2013 at least) the average rent for a single bedroom apartment in Edmonton was $897/month, so there's two weeks income. Is a vehicle needed? Are there any dependents? Are there credit card bills to pay? Any savings at all??

Maybe after all that it is possible to barely squeak by, but all it would take to end up on the street is to lose the job and not find work for a few weeks. No savings, no credit, no nuthin'

IMO that's a precarious place for anybody to be in...