185,000 jobs ‘at risk’ from minimum wage hike

185,000 jobs ‘at risk’ from minimum wage hike

185,000 jobs ‘at risk’ from minimum wage hike Ontario’s planned minimum wage rise to $15 an hour will put 185,000 jobs at risk and create a $23 billion “hit” for businesses in its first two years, according to an independent economic analysis.

The report by the Canadian Centre for Economic Analysis (CANCEA), released on Monday, was commissioned by the Keep Ontario Working Coalition – a lobby group of employers and the Ontario Chamber of Commerce (OCC).

The report says 2.4 percent of Ontario workers could be negatively affected by employment changes resulting from the wage rising to $15 in January 2019.

The current minimum wage, $11.40 an hour, will rise to $11.60 in October and $14 in January 2018.

The report says the wage rise will create massive costs for businesses, which they’re likely to offset by reducing hiring, demanding more work from their current employees, and replacing workers with technology and process improvements.

Women, workers aged under 25, and small businesses are disproportionately at risk, the report says.

There’ll also be flow-on effects for consumers, with the report predicting the cost of goods and services to rise by an average of $1300 per household each year.

"Given the significant, sudden and sizable changes it would be remiss to expect that unintended consequences would not follow,” says CANCEA president Paul Smetanin.

OCC has urged the provincial government to slow the timeline for implementing the $15-an-hour wage, warning vulnerable workers will be at the fore of any job losses.

The government has indicated it may offset some of the costs for businesses, though it has not yet released details.

In a statement to HRD, Labour Minister Kevin Flynn said his ministry was reviewing the CANCEA report.

However, he defended the planned wage rise, maintaining the proposed law change would "bring transformative changes to workplaces across Ontario", support families, and retain a competitive business climate.

"Many businesses across the province have come out in support of our plan ... However, we recognize there are concerns from the business community," he said.

"We are committed to working with the business community to bring forward initiatives that will improve our competitiveness even more. That being said, we will not back down from our plan to bring fairness to Ontarians."

 

 

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Employers push back at minimum wage hike

 

4 Comments
  • JeannieM 2017-08-14 11:53:23 AM
    1. I'm not entirely confident that this research is without bias considering who commissioned it.
    2. The minimum wage does need to increase, but maybe not as quickly as this legislation proposes.
    3. I question the whether we need a province wide minimum wage at $15.00. Sure, $15 makes sense in Toronto because of the high cost of housing, etc. But that is not the case in many other areas of the Province. I have to wonder if this study even looked at the impact by region because I suspect that small business in small town Ontario will have a disproportionately difficult time coping with this.
    Post a reply
  • PJ MacLean 2017-08-14 11:53:29 AM
    What do you say to the actual experiences in several areas that have raise the minimum wage and the sky did not fall? I think this is way overdone and a pretty hysterical take on the issue. Kind of like the Year 2000 perhaps. The positive impacts cannot be overlooked. Fewer people having to work 2 or 3 jobs. Lower turnover. Reduced hiring costs for employers. Better customer service due to more consistent staffing. We will see.

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  • Kayt 2017-08-14 12:32:48 PM
    I am not convinced that the sky is going to fall over this, although I understand that businesses want to protect their profit margins. Perhaps it is too quick and a slower transition could be considered. However, no one has a "right" to have a business. A business owner who can't afford to pay a living wage can't afford to have a business. Why should workers have to continue to struggle under the burden of working for a less than adequate wage, and often no benefits, so someone else can make a higher profit in their business? Having your own business is not an entitlement. To say that there will be less hiring, and more work expected of those still employed is such a lame scare tactic. If a company's profit margin is that tight and tenuous, then the business has other, bigger problems. Business conditions change and businesses have to adjust.
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