The Nova Scotia Minimum Wage Review Committee is recommending the province increase its minimum wage to $15 per hour six months earlier than originally planned due to the impacts of inflation.
In its December 2022 report, the committee recommended the province increase the minimum wage to $14.50 on April 1, 2023, and then to $15 per hour on Oct. 1.
Its previous recommendation made in December 2021 — which the province accepted — was to increase the wage to $15 by April 1, 2024. The current minimum wage is $13.60 per hour.
Due to the “unforeseen increases in inflation,” the December 2022 report said, the move to a $15 minimum wage should be accelerated.
“The Committee’s December 2021 recommendation to reach a $15.00 minimum wage by April 2024 was made with concerns about minimum wage earners living below the poverty line and struggling to make ends meet in mind,” the 2022 report said.
“At that time, inflation (i.e. the percentage change in CPI) for the 2022 and 2023 calendar years was projected to be 3% and 2%, respectively. Inflation for the 2022 calendar year is now estimated to be 7% and inflation for the 2023 calendar year is currently forecasted to be 4%.
“Any increase in the minimum wage that is matched by an increase in inflation results in no increase in purchasing power for the minimum wage earner.”
The committee also recommended a new formula for calculating minimum wage increases. It said starting in April 2024, the minimum wage should be adjusted each year by the percentage change in the projected annual CPI for the calendar year immediately preceding the year the adjustment is made, plus an additional one per cent.
It also said changes to the minimum wage should allow time for businesses to plan for them.
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“The Committee recognized that the unforeseen and significant increases in inflation not only impact workers and their families but also impact the bottom line for many businesses,” it said.
“With these considerations in mind, the Committee felt the previously recommended increases to the minimum wage would need to be accelerated, but that moving to $15.00 per hour too rapidly would make it too difficult for businesses to absorb the increased cost of labour.”
According to the report, minimum wage earners made up about seven per cent of workers — 28,500 Nova Scotians — during the period from April 2021 to March 2022.
It said they work primarily in retail trade, followed by food and accommodation industries. Fifty-six per cent of minimum wage earners are female, 64 per cent are non-students, 27 per cent are over the age of 35, 37 per cent are employed full-time and 46 per cent have a post-secondary education.
In a statement, the province’s Department of Labour, Skills and Immigration said the government “will seek input from community partners before making a decision on the committee’s recommendations.”
“We thank the committee for its important work as the minimum wage rate impacts Nova Scotians in every region of the province,” said Jill Balser, Minister of Labour, Skills and Immigration.
“As we decide on the path forward, it’s important that we take a balanced approach and consider the impacts to employers and employees, particularly as all Nova Scotians and businesses continue to deal with the rising cost of living and inflation.”
Balser told reporters following a cabinet meeting Thursday that her department has until early February to decide.
Premier Tim Houston said while he respects the findings of the report, the province needs to consult with the community first before making a decision.
“We’ll do some next steps on that. We’ll talk to other stakeholders, industry and stuff, but we know with the pressures on Nova Scotians and the way that inflation has been, that people are under a lot of pressure. So I thank the committee for their work,” he said.
Still short of living wage
Even if the recommendation is put in place, the wage would still fall far short of what’s considered a living wage.
According to a September 2022 report from the Canadian Centre for Policy Alternatives, the living wage in the Halifax area was $23.50 last year.
The living wage is calculated based on how much a family of four, with two parents working 35 hours a week, would have to earn to cover all necessities and have a decent quality of life.
At the time, the report said the plan to move to a $15 minimum wage was “too slow.”
“Life should not be a constant struggle,” the report said. “Yet, for many Nova Scotians, that is their reality, and the challenge to make ends meet has gotten even tougher this year.”
It also called on the province to strengthen its employment standards by introducing paid sick days for all workers, increase government benefits, reform the taxation system, improve access to child care and expand services like public transportation and affordable housing.
In a statement Wednesday, the advocacy group Justice for Workers called the recommendation a “partial victory,” but said “what workers really need amidst the skyrocketing cost of living is a minimum wage of $20.”
“Workers cannot wait even longer for the government to take meaningful action,” the group said.
Nova Scotia’s minimum wage is among the lowest in the country, with only Saskatchewan ($13) and Manitoba ($13.50) having lower wages.
Prince Edward Island currently has the highest minimum wage in the Maritime provinces at $14.50, with plans to raise it to $15 in October. New Brunswick’s current minimum wage is $13.75.
— with a file from The Canadian Press
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