Alberta minimum wage set to increase Sunday, becoming highest in Canada

Some worry about impact to business as Alberta’s minimum wage is set to go up this weekend
WATCH ABOVE: Alberta's minimum wage will increase to $13.60 an hour on Sunday. Opinions vary how the increase will impact the province's economy. Tom Vernon reports.

Alberta will have the highest minimum wage in the country when it increases to $13.60 an hour on Oct. 1. It’s part of the NDP government’s three-year plan to reach a $15-an-hour minimum wage by 2018.

On Friday, those in favour and opposed to the move were voicing their opinions.

“Nearly 300,000 Albertans currently earn less than $15 an hour,” Labour Minister Christina Gray said. “Most of these Albertans are women, one in three have a young family, some are single parents, over half work full time and the vast majority are in permanent positions. All of them are deserving of a living wage.

“No one working a full-time job should have to choose between paying rent and buying groceries,” Gray said.

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Alberta Federation of Labour president Gil McGowan is a proponent of the increase. He said there are two major upsides to increasing the minimum wage: it reduces employee turnover, which increases productivity and profits, and it results in minimum wage workers spending more money on the local economy.

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“They don’t hoard that money, they don’t save it, they don’t spend it on lavish trips abroad like wealthier people might, instead they spend it and they spend it on the local economy,” McGowan said.

Watch below: Gil McGowan, Alberta Federation of Labour President, says there are many positives to Alberta increasing its minimum wage on Oct. 1.

Union President weighs in on Alberta Minimum Wage Increase
Union President weighs in on Alberta Minimum Wage Increase

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Local businesses have argued a minimum wage increase will force them to cut staff or cut hours. An Alberta economist published a report with the C.D. Howe Institute suggested raising minimum wage to $15 an hour by 2018 could lead to the loss of roughly 25,000 jobs.

“That’s a lot of jobs,” Joseph Marchand, economist and University of Alberta associate professor of economics, said. “If you look at individuals geographically between the 15 to 24 age group, they’ve already lost 27,000 jobs over the last two years since the policy was implemented.”

READ MORE: Economists dispute report suggesting Alberta minimum wage hike will cost 25K jobs

University of Calgary associate professor of economics Trevor Tombe disputed the numbers, arguing the number of jobs lost would be about 15,000.

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The United Conservative Party is urging the NDP to halt the scheduled increase.

“Since the NDP took office, they have put their ideology ahead of the best interests of Albertans,” UCP labour critic Prab Gill said.

“A lot of small businesses in Alberta rely on minimum wage workers and the jump in their labour costs alone has been enough to cause some to lay off employees and force others to close their doors,” Gill said during a news conference with UCP interim leader Nathan Cooper and fellow labour critic Glenn van Dijken.

“This policy risks killing thousands of Alberta jobs.”

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van Dijken says job losses will most affect teens, young adults and recent immigrants.

“Are we setting up a situation here where it causes the youth to have difficulty in being able to be successful in starting to get into the workforce?” he asked.

McGowan said those are false, dire threats.

“We have literally 100 years of experience with these kind of predictions and you know what? It’s never happened. The sky has never fallen, massive job losses never occurred as a result in the increase in the minimum wage, whether those increases are small or large.”

READ MORE: Reality check: Is a $15 minimum wage bad for the economy?

McGowan said an increase in minimum wage in Alberta will have the impact of injecting nearly $1 billion into the provincial economy, which will grow the economy and create jobs.

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“It’s useful to compare performance and our labour markets to Saskatchewan which has a very similar economy,” McGowan said.

“If the minimum wage was a job killer, what you should see is job loss in low-wage service sector jobs here in Alberta and nothing similar in Saskatchewan, but that’s not happening.

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“Our labour markets are on a very similar trajectory.”

Mark Bellows, co-owner of Edmonton restaurant The Local Omnivore, said they implemented a $15-an-hour wage when the shop opened last winter, instead of waiting three years for the legislation to kick in.

Bellows said it was a “moral” decision more than anything.

“It is very tough. It is a lot more money to be paying. It’s a bigger responsibility. But at the end of the day, as restauranteurs and as business owners , it’s our job to make our business viable.

“I would be bankrupt if it wasn’t viable,” Bellows said.

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The UCP’s interim leader thinks there are better options than a minimum wage increase.

“It is quite possible that we need address some of these challenges around single moms, families that are impacted by the minimum wage increase — and we’re not suggesting we should just turn our backs on all of those folks across the province — but using such a blunt implementation of minimum wage has significant negative consequences on some of those very people that they’re trying to help… particularly if there are less jobs available for that single mom, or less hours, that’s a net negative,” Cooper said.

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