Having Canada's lowest minimum wage is "embarrassing" and the New Brunswick government is planning two increases in 2009, Labour Minister Donald Arseneault said.

The province is planning two 25-cent increases — on April 15 and Sept. 1 — boosting the minimum wage to $8.25 an hour. Arseneault said he's also asking the province's minimum wage board, which is comprised of employees and employers, to develop a long-term plan that will see the wage become more competitive over time.

"It's embarrassing. We're the last in Canada," Arseneault said.

"We have a lot to do. Businesses also have to look in the mirror."

The increases to the minimum wage are staggered to avoid being implemented during the summer, said Andreea Bourgeois, the director of provincial affairs for the Canadian Federation of Independent Business. She said mandatory wage increases announced in the summer can hurt small companies, especially when only short notice is given.

Bourgeois also characterized the minimum wage changes as "cautious" and said she doubted it would negatively impact a lot of businesses.

"It's not an overly ambitious increase, 25 cents is much easier to swallow than a $1 increase in the minimum wage," Bourgeois said.

"I can't guarantee there will be no layoffs but because we have a more realistic plan it will help New Brunswick out of the recession much faster than Nova Scotia."

Bourgeois said a recent survey found New Brunswick business owners exuding more confidence than most of their Canadian counterparts and being "a lot more optimistic" about the economy than those in Nova Scotia.

Minister wants long-term plan for wage hikes

New Brunswick's labour minister said he understands how a jump in the minimum wage can affect small businesses and wants a long-term plan in place so companies can budget for future wage increases.

Arseneault said higher wages can also help businesses in terms of fostering better morale and higher productivity in the workplace.

Newfoundland and Labrador recently announced that it will hike its minimum wage to $10 an hour over the next 18 months.

Arseneault would not weigh in on whether New Brunswick should also see its minimum wage rise to $10 an hour. He said that would render the board's work redundant.

"We're at the bottom of the pack, we're not saying we have to be at the top of the pack," he said.

"But there is an issue there. We have to be there to protect those employees as well."

Bourgeois said the small business organization has a member on the minimum wage board. She said she hopes the board designs a long-term plan that balances the need to ensure employees can earn a decent living but makes covering the new costs not out of reach for businesses.

"We have to look at our industrial composition and our ability to pay in New Brunswick," she said. "I want to see a realistic goal in New Brunswick."

The labour minister has also asked that the minimum wage board meet with the province's poverty reduction committee that is currently holding public consultations.