Goes too far or about darn time, Alberta minimum wage hike continues to divide

In four years, Alberta has gone from having the lowest minimum wage in the country to the highest. Effective today, it’s now $15 an hour.

'It’s no longer OK to pay poverty-level wages,' a progressive advocacy group says

Alberta's minimum wage is now $15 an hour. (CBC)

In four years, Alberta has gone from having the lowest minimum wage in the country to the highest. Effective today, it's now $15 an hour.

A business group says that's too much too soon and small businesses are suffering, while a progressive advocacy organization is calling the move long overdue.

"Small business owners are concerned that this minimum wage hike goes too far, too fast," Amber Ruddy of the Canadian Federation of Independent Business told Alberta@Noon Monday.

"We've seen almost a 50 per cent increase since this government took over. It's adding a lot of costs to entry-level jobs. The cost of creating a job has gone up."

She says Alberta's minimum wage increase seems to be based on the Fight for $15 campaign in the U.S.

"So it's almost like we have plucked this idea and done it faster and gone further, without really understanding the economic impact and we've been asking the government to release that information."

Amber Ruddy is the director of provincial affairs with the Canadian Federation of Independent Business. (CFIB)

About 10 per cent of Alberta employees earned less than $15 an hour prior to the Oct. 1 increase. Almost two-thirds are women, 37 per cent are parents, more than half work full time and a little shy of one-third are teenagers.

Dan Doucet runs a painting business in Edmonton. He says he's not against the increase, but there are other factors that should have been considered along with it.

"I support the minimum wage increase and want to help low-income earners but I am finding the Rachel Notley government hasn't done enough to help business owners," Doucet said.

"We have been hit with extra taxes, the carbon tax and now this minimum wage increase. I am finding it more and more difficult to run my business and to find it appealing to run a business here in Alberta. It affects everybody all across the board, it's not just the minimum wage earners."

Joel French says Monday's increase was overdue. He's the executive director at Public Interest Alberta in Edmonton.

"It puts more money in the pockets of low-wage workers, the lowest-wage workers in the province. We know they spend every dollar back in their community," French said.

"It's no longer OK to pay poverty-level wages in this province and that's where we are at least moving towards today with this step."

Joel French is the executive director of Public Interest Alberta based in Edmonton. (Submitted by Joel French)

He says while there could be some unintended consequences, they are worth working through.

"We are talking about a province where the average wage is above $30 an hour.

"It's a challenge, but it's a challenge that we owe it to ourselves and to our fellow Albertans to take on."

A caller from Edmonton, Lawrence Monks, isn't so sure though.

"I think it's great minimum wage is going up," Monks said.

"But it's naive to think that costs aren't going to increase because of that. If you are a small business, and I am not, there are only two things you can do. You got to find ways to make more revenue or cut your costs. People need to think things through."

Another listener agrees, tweeting the increase affects more than just minimum-wage earners.

"The people who aren't getting a raise are now paying $50 a month more for daycare, more for groceries, more for necessities which also increases for the people gaining from minimum wage," C Moltzahn wrote.

Henry Wearmouth in Calgary, though, says it's a win-win.

"Giving a business a tax break or making labour cheaper doesn't mean they will hire more people, but making policies that increase demand for their products will force them hire more people," Wearmouth said.

"A high wage and a certain level of disposable income are absolutely necessary for the proper functioning of the machinery of capitalism."

French says extensive studies disprove some of the rhetoric around the negative impacts of increasing the wage.

"Minimum wage increases have been studied to death across North America. The conclusion of those studies, if you take them all together, is that there is little or no impact on employment levels," he said.

"The reality is, economy-wide in Alberta right now, we have more people working in the province than ever before in our history. We also have record retail sales and record restaurant receipts. Those are the sectors where we see a ton of these workers employed. I think it's a good sign that things are actually healthy."

Ruddy says there are different ways of helping low-wage employees and there are hidden costs.

"Small business owners want to help low-income earners but we think there are many other ways to do that and this policy specifically has a lot of unintended consequences," she said.

"If you have ten employees you could be adding over $100,000 to your wage bill this year."

That, however, is a price a Pincher Creek small business owner is willing to pay.

"I run a bottle depot in Pincher Creek," Wes Whitfield said.

"The employees I paid above minimum wage, the reason is they are skilled and trained and I don't want to lose them. In my industry retaining employees is fairly hard because it's a sticky, dirty job."

He estimates the increase is going to cost him about $80,000 a year, and while a training wage would be helpful, he's against replacing people with technology.

"Personally I am not going to do it because this is a small town and I really enjoy being an employer in a small town."

What does the increase in minimum wage mean for you? 52:39

With files from Alberta@Noon