SASKATOON – Saskatchewan’s current minimum wage isn’t enough for families to support themselves “with confidence,” according to a report presented by the Saskatoon Poverty Reduction Partnership.
The study, titled “The Business Case for a Living Wage in Saskatoon” recommends an hourly rate of $16.77 for people working a minimum of 35 hours a week. The findings are based off the average household with two children and two working parents.
“The living wage is the amount that an employee needs to earn, in order to live healthily and also be productive as an employee,” said the report’s co-author Charles Plante.
The current minimum wage in Saskatchewan is $10.50.
The authors argue low wages lead to “poor customer service, high turnover, absenteeism and a depressed local economy.”
Laura Neufeld owns The Better Good – an eco-friendly, fair trade home and clothing store in Saskatoon. Since she began paying employees $18 an hour last summer, the business hasn’t lost any employees.
“They’re thinking of it more as a long-term place to work instead of a short, in-between place,” Neufeld said.
For her, the increased cost to retain employees has counteracted the amount of money she would otherwise spend on hiring and training new staff.
Some economists argue dramatic increases in the minimum wage can actually be counter-productive, putting more pressure on small businesses and leading to increased unemployment and inflation.
“Any effects [on unemployment] that there will be, will be concentrated among lower-wage workers and younger workers, particularly teenagers,” said Kelly Foley, assistant professor of economics at the University of Saskatchewan.
Similar living wage studies have been calculated for more than two dozen cities across Canada. The study focuses on expenses like housing, childcare, food, clothing, healthcare and transportation.
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