Analysis

Who earns minimum wage in Alberta? About 100,000 more people than before

The rising wage floor has increased the pay of tens of thousands of Albertans by a small but significant degree. A dollar or two an hour may not sound like a lot to some of us, but for others, it's the difference between living above or below the poverty line. Who are these people,? Not necessarily who you might think.

What it means for growing ranks of Albertans who have been swept into minimum-wage-earner category

Jobs in the restaurant, hospitality and retail sales industries are often the ones that pay minimum wage. (Steven Senne/AP, Paul Sakuma/AP, Simon Dawson/Bloomberg)

A driver for a furnace-cleaning business. An aide at a fertility clinic. A greeter at a laser-tag arena.

These are some current job openings in Alberta that are offering minimum wage: $13.60 per hour.

The successful applicants would join the roughly 133,000 other Albertans being paid the lowest legal rate for hourly work. Together, they represent about seven per cent of employees in this province.

But it wasn't always like this.

Not long ago, minimum-wage work was much more of a rarity. Just 34,000 people — or roughly 1.8 per cent of Alberta employees — earned the legal minimum of $9.75 an hour in 2013.

The reason so many more people now earn minimum wage is that it has been increasing steadily. As it rose, it swept up tens of thousands of people who used to earn just above the threshold in the category of minimum-wage earners.

This began in earnest in 2015, when the newly elected NDP government set in motion a plan to boost the minimum wage at a pace the province hadn't seen before. When it started, Alberta's rate was the lowest in the country. When the plan concludes in October, it will be the highest, at $15 per hour.

This major shift has been described, by some, as an experiment. And, indeed, the full set of ramifications won't be known for some time. Economists are still studying the effects on jobs and consumer prices.

What is known is that the rising wage floor has increased the pay of tens of thousands of Albertans by a small but significant degree. A dollar or two an hour may not sound like a lot to some of us, but for others, it's the difference between living above or below the poverty line.

Who are these people, exactly? Not necessarily who you might think.

Who works for minimum wage

There's a stereotype that minimum-wage jobs are typically for teenagers and students in their early 20s who are still living with their parents. But, according to data compiled by Statistics Canada for CBC News, this accounted for only about 31 per cent of people earning minimum wage in Alberta last year.

A larger proportion earn minimum wage as either the lone breadwinner in a household or a spouse in a dual-income household.

Seven out of 10 Albertans in these types of living situations worked full time at their minimum-wage jobs last year, according to the data. On average, they were just under 40 years old. Two-thirds were women. Roughly half were immigrants. 

And nearly three out of 10 had a bachelor's degree — or higher.

Audie Fox falls into that last category. She's 36, university educated and does freelance work as a writer. But her main sources of income are bartending and serving — jobs she says have always been a "fallback" for her.

Audie Fox works as a server and a bartender as 'fallback' jobs, but has a university education and additional post-secondary training in journalism. (Robson Fletcher/CBC)

On top of her university degree, Fox recently completed additional post-secondary training in journalism. But she has struggled to find consistent work in the industry.

To make ends meet, she's working at two pubs in Calgary, taking as many hours as she can get.

"If I'm lucky, I'm working 60 hours a week," she said. "I work non-stop, and that's so I can keep my head above water. But that's also to compensate for the weeks when it's quiet, it's dead, everyone's out of town for the long weekend and I'm being sent home after an hour of being at my shift."

It's a common experience, says Carolyn Davis with Momentum, a Calgary-based charity that helps people living on low income with money management and career development. She said 32 per cent of the people that the charity worked with last year had a bachelor's degree and 61 per cent had at least some level of post-secondary education.

"The issue of underemployment really is a big one," says Davis. "And we need to be paying more attention to it."

'Survival jobs'

Davis says many people working for minimum wage look at their positions as "survival jobs" and hope they will only be temporary.

​"They're really looking for their next economic opportunity and they really do want to contribute in a more meaningful way to the tax base, to their families and, of course, to the economy."

Jorden Dye is in that boat.

At 27, he's a bit older than many of his classmates at Mount Royal University. He has one year left in a business degree that he hopes will lead to better job opportunities.

Jorden Dye, 27, is set to complete a business degree from Calgary's Mount Royal University next year that he hopes will lead to higher-paying work. In the meantime, he has been surviving on minimum-wage jobs. (Contributed)

In the meantime, he works as much as he can as a line cook — and sometimes a dishwasher — earning minimum wage.

He lives with his father but, still, his income just barely covers his expenses, with virtually nothing left over for even basic luxuries like a night out with friends.

"I don't have a personal life," says Dye. "I think that's the biggest thing. Like, I avoid most of my friends because I'm the only one currently in school, and everything you want to do at 27 involves money."

It's not ideal, he says, but it's not forever.

For others, though, these types of "survival jobs" are anything but short term.

About 42 per cent of minimum-wage earners have been in their jobs for between one and five years, according to data regularly monitored by the province. Another 16 per cent have been at it for more than five years.

It can be tough, surviving on that level of income for so long. But, to a degree, it has been getting easier.

How minimum wage compares with the past

Relative to inflation, Alberta's minimum wage reached a historic high last October, when it increased to $13.60 per hour.

That's more, in real dollar terms, than has been paid in this province since it adopted a standard minimum wage across all regions in 1966. (Prior to that, there were different rates in urban centres and rural areas.)

To see how things have changed, take a look at how much minimum wage has varied over the past 50 years, when you convert everything to modern-day dollars.

As you can see in the above chart, the recent run-up continues a trend that began around the turn of the millennium.

This upward swing is the opposite of what transpired the two previous decades, as inflation outpaced any increases to the minimum wage. Throughout the 1980s and 1990s, the purchasing power of Alberta's lowest-wage workers was steadily eaten away.

The recent increases have also brought Alberta more in line with the national average, when it comes to the proportion of workers who earn minimum wage.

You can see how that has shifted in the interactive graph below.

Click on the buttons to see how the proportion of minimum-wage earners varied by year in each province:

(Can't see the graph? Click here for a version that should work with your mobile device.)


Alberta's latest jump from $12.40 to $13.60 an hour (which took effect in October) is enough to lift full-time workers with no dependents above the poverty line, says Ian Hussey, a research manager with the University of Alberta's Parkland Institute.

Single parents, however, may still fall below that line, depending on how many children they have. But, no matter how you slice it, says Hussey, minimum-wage workers have seen a "substantial increase in wages" in the past few years.

"And much of that is not clawed back for taxes because Alberta has the highest personal income tax exemption in the country."

Of course, getting an hourly raise is great. But there can be drawbacks, too, if it means you get fewer hours.

Or no hours at all.

Less work or no work

Critics of Alberta's minimum-wage hikes have warned the increased payroll costs will prompt employers to lay off staff or force some businesses to close shop altogether.

There have been plenty of warnings to that effect, with some even forecasting tens of thousands in job losses across the province due to the minimum-wage increases. Researchers who have been following the employment figures, however, say there has been no evidence to date of such severe declines.

But one thing Fox has noticed in her work as a bartender and server is that employers are cutting back on hours in response to the increased payroll costs.

"You'll notice that a lot of restaurants and bars, especially, are running bare-bones staff."

Customers, too, seem to be tipping less, with some explicitly citing the new minimum wage as the reason.

"I do hear that a lot," says Fox. "There's a lot of grumbling about the NDP and Rachel Notley, or just, 'I don't need to tip as much now, because you're making more.'"

Overall, Fox figures she's no further ahead when the increased minimum wage is factored against the fewer hours and lesser tips.

Dye, however, has had a different experience.

'Breathing room'

As a line cook, Dye's income comes more from his wage than from the small share of restaurant tips he receives, so he says the increases have been more noticeable.

It wasn't life changing, but he says last year's increase of $1.20 per hour was nonetheless helpful. Still, it hasn't changed one basic aspect of living on minimum wage.

"You just constantly think about money," he says. "It just becomes the overarching factor of your entire life, whether you want it to or not."

He says people in his situation are especially looking forward to the next increase, which will conclude Alberta's three-year transition from lowest to highest minimum wage in the country. Come Oct. 1, the rate will jump another $1.40 to $15 per hour.

"When you break down the math, you're getting about $1,000 every two weeks," says Dye.

"That's $2,000 a month, which is breathing room for a lot of people I know."


Calgary: The Road Ahead is CBC Calgary's special focus on our city as it passes through the crucible of the downturn: the challenges we face, and the possible solutions as we explore what kind of Calgary we want to create. Have an idea? Email us at calgarytheroadahead@cbc.ca.


More from the series:

About the Author

Robson Fletcher

Reporter / Editor

Robson Fletcher joined the CBC Calgary digital team in 2015 after spending the previous decade working as a reporter and editor at newspapers in Alberta, British Columbia and Manitoba.

Comments

To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.