Minimum wage increases


Image via Thinkstock
Image via Thinkstock

How it really affects Vancouver workers

By Davie Wong, Columnist

At long last, the minimum wage in BC has been increased. Earlier in the year, Job Minister Shirley Bond promised a pay raise to those working on minimum wage. She announced that, starting September 15, the minimum wage in BC is to be $10.45, an increase of two per cent or 20 cents. She also promised to increase the rate of minimum wage every year to better compensate for the rate of inflation and cost of living.

But is it enough? Irene Lanzinger, leader of the BC Federation of Labour, said in an interview with the Globe and Mail that the 20 cents increase was a “pathetic response.” She is leading a campaign that wishes to see the minimum wage raised to $15 an hour. The current plan would see BC meet that goal in 2034.

The federation is relying on pressure from the growing number of frustrated people in the Lower Mainland as the cost of living within the region continues to climb. At the moment, according to an accumulation of data obtained from the Mercer Cost of Living 2015 survey, Vancouver is the most expensive city in Canada to live in. Vancouver also had, until recently, the third lowest minimum wage in Canada. However, as other low minimum wage provinces also raised theirs, BC still remains in this position.

When asked about this situation earlier in the year, Premier Christy Clark said that she would not raise the minimum wage rate to the requested $15 an hour rate as “the economy [was] too fragile for the shock of the $15.” She also said that having a gradual increase over time was better for small and medium size businesses because it gave them the proper time to adjust rather than a straight jump. Evidence at this time also supports Clark’s claim.

Not too long after the Premier’s announcement, Seattle put into effect their new minimum wage rate. The minimum wage through out the city was set to be gradually raised to $15 dollars. Companies then have until 2017 to phase into the new $15 dollar an hour minimum wage. The previous minimum wage was set at $9.47. According to the American Enterprise Institute, over 1300 restaurant employees have lost their jobs due to the raise in minimum wage. Restaurants have also considered raising prices to better account for the higher minimum wage.

Some restaurants have even started changing tipping policies to better accommodate the new wage line. Many have eliminated tipping as a whole and instituted a 20 per cent service fee instead, making meals more expensive as a whole. On top of that, since the rise in minimum wage, many companies have been cutting job employment benefits to better compensate. What may have been company paid parking or paid lunches have been completely cut to make up for the raise.

This precedent means that Vancouverites could expect some of the same problems if a $15 dollar minimum wage spike does occur. In the meantime, Vancouverites should not expect any major changes any time soon.