Minimum wage still not enough for many workers

Ontario Premier Kathleen Wynne announced a 75-cent increase to Ontario’s minimum wage last week. It will take effect later this year. But it’s not enough for the province’s minimum wage workers to live on.

The most recent data from Poverty Free Ontario says the poverty line is just under $20,000, after taxes. The current minimum wage is $10.25. An adult who makes minimum wage and works 35 hours a week for a full year would make $18,655.

The increase to $11 an hour pushes that yearly amount to $20,020 – a whopping $20 above the approximate poverty line.

And that’s just the people who are able to work full time. University students enrolled in full-time schedules typically have a limited number of hours they can work each week. The average tuition at Ryerson is $6,851. On top of that, students must pay for transportation, living expenses and food.

In a big city like Toronto, these things don’t come cheap. There is no way students can support themselves, let alone any family dependants, while making minimum wage.
It doesn’t seem fair that people who work full time are still falling below the poverty line. If Wynne followed the formula her predecessor Dalton McGuinty put in place to raise minimum wage 2.5 times faster than the inflation rate, minimum wage would have jumped to approximately $11.60 by now.

Last spring, protesters urged Ontario’s Ministry of Labour to raise minimum wage to $14 an hour, since the current wage has been frozen for four years, which would push minimum wage workers to approximately 10 per cent over the poverty line.

The protesters may be on to something: Canada’s average hourly wage was $23.25 for December 2013, more than double minimum wage. Costs typically reflect this average. Forget keeping up with the Joneses. This is a case of struggling to keep up with the grocery bills.

The increase is a start, but it does nothing to make up for the nine per cent of Canadian workers living under the poverty line for the past four years.

While the wage freeze was due to the recent recession, doesn’t it make sense that higher wages for workers leads to decreased debt and more spending, ultimately fostering a stronger economy?

Bigger, more frequent wage increases could help bridge the gap between rich and poor. Businesses could make more money off more people who can afford their services. The extra $1,365 a year minimum wage workers will make with this increase will hardly make a dent when it comes to paying off debts and contributing to the economy.

If the province were to implement a stronger policy when it comes to increasing minimum wage, we may live to see the day minimum wage workers are actually able to afford basic necessities like food and rent.

This story was first published in The Ryersonian, a weekly newspaper produced by the Ryerson School of Journalism, on February 5, 2014.

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