Shops cutting hours, upping prices after minimum wage hike

Just days after Ontario's minimum wage hike took effect, businesses in Ottawa are taking steps to cope with the added costs. While customers may have to foot the bill, some business owners say they can only hope they'll make ends meet.

Ontario minimum wage rose to $14 an hour on Jan. 1, up from $11.60

France Desfossés, co-owner of Planet Coffee in Ottawa's ByWard Market worries the province's minimum wage hike could make her business unprofitable. (Marc-André Cossette/CBC)

Just days after Ontario's minimum wage hike took effect, businesses in Ottawa are taking steps to cope with the added costs. While customers may have to foot the bill, some business owners say they can only hope to make ends meet.

At Planet Coffee in Ottawa's ByWard Market, baristas serve up lattés and hot chocolates, while co-owner France Desfossés worries whether her business can stay afloat.

"We could end up closing if it gets to be too serious," she said. "If anything else happens — little bit of a loss in sales, somebody else opens up too close to us — yeah, we could close."

Faced with the wage hike, Desfossés said she saw no other choice but to raise the price of her food and coffee drinks by as much as 50 cents per item. With no shortage of coffee shops in the neighbourhood, she worries customers might take their business elsewhere.

"We'll have to see how it goes," Desfossés said. "Hopefully, sales will be as good as they are now. If anything changes, it could mean really big trouble for us."

A living wage

The Ontario Liberal government hiked the minimum wage to $14 on Jan. 1, up from $11.60. As part of the government's plan, the wage will climb even further to $15 next January.

Ontario isn't the only province boosting wages. By the end of 2018, Alberta, Quebec and Prince Edward Island are also expected to hike their minimum wages. In a report published over the winter break, the Bank of Canada said those hikes could cost about 60,000 jobs across the country.

Baristas Sheila MacLaine, left, and Gabrielle Pronovost prepare coffee drinks at the ByWard Market's Planet Coffee. The shop's owner, France Desfossés, said she's struggling to cope with Ontario's minimum wage hike. (Marc-André Cossette/CBC)

Ontario Premier Kathleen Wynne has defended the changes, saying they're designed to make sure workers get a living wage.

Desfossés said she agrees workers deserve better, but she can't ignore her bottom line.

"It's not because I don't want to pay my staff more," she said. "It's that I just — I can't."

Cutting hours

At the Herb & Spice shop on Wellington Street West, co-owner Mike Steinberg has taken another tack, reducing the store's opening hours as well as hours for part-time staff.

As of yesterday, the shop will close at 7 p.m. instead of 8 p.m. To Steinberg, it seemed like the best possible option to deal with the added labour costs.

Mike Steinberg, principal owner of the Herb & Spice shop on Wellington Street West, said he decided to reduce his store's hours to cope with the minimum wage hike. (Marc-André Cossette/CBC)

"Everybody was a little bit nervous when I walked in early in the morning yesterday," he said, referring to workers worried about how the wage hike might affect their hours.

While senior staff won't see any changes, Steinberg said part-time staff will be losing a few hours a week.

Like Desfossés, he agrees workers should get a higher minimum wage. But with recent increases in property taxes and hydro rates, Steinberg said the sudden wage hike is a lot to handle.

"It's just another one of those price increases that begin to make it harder and harder to operate," he said.

With files from Pete Evans