Alberta minimum wage going up on October 1

EDMONTON – Alberta, one of the lowest payers of minimum wage in Canada, is about to become one of the highest.

As part of a plan to increase Alberta’s minimum wage to $15 an hour by 2018, the province will increase minimum wage from $10.20 to $11.20 on Thursday.

When that kicks in, only Ontario ($11.25 an hour on Oct. 1) and the Northwest Territories (currently at $12.50 an hour) will pay more to those who earn the least.

Saskatchewan and Manitoba are also increasing their minimum wage on Thursday.

READ MORE: Minimum wage set to rise in Saskatchewan on Oct. 1

“Increasing minimum wages will help low-income earners take care of their families, and will reduce staff turnover, lower hiring costs, and improve fairness. Minimum wage earners spend more of their income, boosting the economy and creating jobs,” Minister  of Jobs, Skills, Training and Labour Lori Sigurdson said in a statement Wednesday.

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WATCH: Minister of Jobs, Skills, Training & Labour Lori Sigurdson discusses the minimum wage increase in Alberta that kicks in Thursday.

In a media release Wednesday, the Alberta Federation of Labour said the wage increase is long overdue.

“This increase to the minimum wage won’t make the sky fall. It won’t cause businesses to grind to a halt,” said AFL Acting President Siobhán Vipond. What it will do is just one thing: it will make life better for Alberta’s lowest-paid workers.”

“Alberta is an expensive province to live in. It’s appalling that for most of the last decade, we’ve had the lowest minimum wage in the country.”

The separate wage for those who serve liquor will also rise from $9.20 to $10.70, but the differential will be eliminated altogether in 2016. At that time Alberta will return to one minimum wage. Alberta is currently one of five provinces with a differential.

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The NDP promised to hike minimum wage during the 2015 provincial election campaign that brought down Jim Prentice and the Conservative party.

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In June, Ken Kobly, president of the Alberta Chambers of Commerce, said he was relieved this year’s wage hike is not higher than $1.

He said the bigger increase will adversely affect employers, and his team will be working over the next few years to convince the government to alleviate social inequality through other means.

“We would like to see perhaps a method that is smarter, that targets in fact those people who do need it at the poverty level,” Kobly said.

Also in June, Wildrose Leader Brian Jean said the NDP is ramming ahead with sweeping changes with little thought to the ramifications.

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“We need to put on the brakes, listen to chambers, small businesses and job creators to make sure we understand the full impact of this,” Jean said.

WATCH: Wildrose MLA Grant Hunter expresses concern the minimum wage increase will have on Alberta’s business community.

Alberta Party Leader Greg Clark agreed, saying it’s disappointing the NDP didn’t look at alternatives or the bigger picture.

Liberal Leader David Swann said the change must be balanced out by, perhaps, reductions in small business taxes.

The Canadian Federation of Independent Business warned increasing minimum wage could lead to the loss of 183,000 jobs in Alberta. The group believes young workers are at the highest risk of losing their jobs.

Ontario increased its minimum in 2014 to $11.00 and faced strong opposition from the business community.

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WATCH: With the Alberta government increasing minimum wage, will knowing servers are making a higher wage affect the way you tip? Tracy Nagai has a look.

Sigurdson said the phased-in increase is in response to concerns from small businesses, who fear they might not be able to afford to pay higher wages.

“We’re certainly being pulled on the other side to go to $15 an hour this year. So we’re being moderate, we’re taking into consideration what they said, and absolutely it’s important for us to support small business,” she said in June.

Sigurdson said she and Premier Rachel Notley met on June 11 and 12 with 48 representatives from business and industry groups, public advocacy and labour organizations and members of the academic community.

“One of the things that we learned in the consultation process is that we need to look at indicators of, ‘How do we know this is actually helping? Is it eliminating poverty?’ We will have more information to assess how it’s going, so there’s more things to look at, for sure,” said Sigurdson, who added more consultations will happen in the future.

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READ MORE: Could you live on the minimum wage?

Currently, about 38,000 Albertans earn minimum wage.

WATCH: Michel Boyer on how the province is poised to have the highest minimum wage in the country.

With files from The Canadian Press.

*Editor’s Note: This story was originally published on June 29. It was updated on Sept. 30.

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