Wage hike critiqued
Keenan Aylwin, manager of Grilled Cheese Social Eatery on Dunlop Street East in downtown Barrie, said he thinks overall it’s a positive move to raise the minimum-wage, but wishes the provincial government would take a harder look at all the costs associated with running a small retail shop or restaurant. MARK WANZEL/PHOTO
Crystal ball viewers say the glass is half-full when forecasting minimum-wage increases across the province.
Raising the minimum wage is expected to add jobs to the economy by 2019, yet teenagers are expected to suffer in the new employment economy, says the Financial Accountability Office of Ontario.
A new report looking into the pros and cons of the Ontario government’s proposed increase from the current $11.40 per hour to $15 over the course of 18 months takes a critical view of the rapid increase.
Yet it also notes a higher minimum wage would also raise labour income and increase consumer spending.
“Overall, it’s a positive move,” said Keenan Aylwin, manager of Grilled Cheese Social Eatery on Dunlop Street East.
“If your employees have more money to spend, it’s better for everyone all around.”
However, Aylwin does say he wishes the provincial government would take a harder look at all the costs associated with running a small retail shop or restaurant.
“The government could be doing more in terms of helping the smaller business owners,” he said.
The province’s accountability office estimates the higher minimum wage will raise total income by 1.3% but agrees the increase would “disproportionately impact workers in certain industries.”
Businesses with fewer than 20 employees hire a larger proportion of workers paid less than $15 per hour, compared to larger employers.
The report points out that lifting the minimum wage will increase payroll costs for Ontario businesses.
That’s what Northern Protocol Computer Sales and Service owner Aaron Weston is worried about.
“I want to grow my business, but the costs keep going up,” Weston said. “If the cost of staffing goes up and all the deductions increase, my employees have said if it puts them in a higher tax bracket, what’s the point?”
Weston said he currently pays his “highly-skilled geeks” more than the minimum wage.
However, if the lowest wage is raised and his staff doesn’t get the same increase, they could feel cheated.
“If their wages don’t go up as well, they’re making 30% less,” Weston said. “Any gains they made by getting an education all get wiped away.”
Weston said it will be hard to maintain a competitive advantage if his staff is being paid what coffee-shop employees earn.
The proposed minimum wage hike is expected to dramatically increase the number of minimum wage workers from just over 500,000 to approximately 1.6 million in 2019.
The province’s financial accountability staff also believe the higher labour income and household spending will boost economic activity, but expect the proposed pay spike would result in the loss of approximately 50,000 jobs overall.
Both Weston and Aylwin said they don’t expect to hire new staff this fall, however an Outlook Survey released by Manpower Group Employment said it’s forecasting a positive hiring climate for Barrie’s fourth quarter of 2017.
“Survey data reveals that 13% of employers plan to hire for the upcoming quarter (October to December), while 3% anticipate cutbacks,” said Tara Benson at Barrie’s Manpower office.
She said about 80% of employers expect to maintain their current staffing levels, while the remaining 4% are playing a wait-and-see game this fall.
“With seasonal variations removed from the data, Barrie’s fourth quarter net employment outlook of 11% is a one percentage point decrease when compared to previous quarterly Outlook (reports),” Benson said.
Heading into the fourth quarter nationally, there’s an expected trend of modest growth, she said.