A new report says a worker receiving minimum wage in Peterborough, Ont., would have to work 86 hours a week to afford a two-bedroom apartment in the city.
The Canadian Centre for Policy Alternatives’ “Can’t Afford the Rent” study looks at the gap between the minimum wage and what it costs to rent an apartment across Canada. The report focuses on the hourly wage required to afford rent while working a standard 40-hour week and spending no more than 30 per cent of one’s income on housing.
For residents in Peterborough working for Ontario’s current minimum wage of $15.50, the report determines they actually need to earn $20.96 an hour to afford a one-bedroom apartment.
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To obtain a two-bedroom apartment in Peterborough, the minimum wage needs to be $25.75, the report states.
Comparatively, the Ontario average is $25.96 an hour to rent a one-bedroom unit and $29.90 for a two-bedroom.
Ontario’s minimum wage rate is set to increase to $16.55 an hour beginning Oct. 1.
“There is no province in Canada where workers can afford an apartment at minimum wage,” the report states. “The neighbourhood-level data paints a dire picture of out-of-control rents.”
The report notes the 86 hours a week Peterborough minimum wagers would need to work to obtain a two-bedroom apartment is nine more hours than the estimate made in 2018.
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Dave Warda, president of the Peterborough and District Labour Council, says finding an affordable apartment is a daunting task for those working for minimum wage.
“To be able to get a job, and pay for rent, and get a little bit ahead, it’s nearly impossible,” he said.
Adding to the woes in Peterborough is the vacancy rate. In January a report from the Canada Mortgage and Housing Corporation noted the Peterborough census metropolitan area (CMA) vacancy rate for purpose-built rental apartments was 1.1. per cent in October 2022 — for the second year the lowest across Ontario. The provincial vacancy rate is 1.8 per cent.
The CMHC study also stated an average two-bedroom apartment in Peterborough in 2022 was $1,339 — a jump of 5.4 per cent from 2021.
Jim Russell, CEO of the United Way Peterborough and District, says the rate of increase for rental units is “far outpacing” the amount of money people are earning, leaving tenants in a tough spot.
“It’s the constant pressure of how you’re robbing Peter to pay Paul in terms of other needs for you, yourself and your family,” he said.
The inability to find affordable housing could also hit the local economy, notes Shuato Cao, an assistant professor of economics at Trent University in Peterborough.
“If a person doesn’t even have an address, there’s a serious issue in terms of job market and these people are more likely to be detached from the labour market,” said Cao.
The CCPA’s report notes only three CMAs in Canada — Sherbrooke, Trois-Rivieres and Saguenay, all in Quebec — have a one-bedroom rental wage that is lower than the minimum wage.
“Smaller towns are just as expensive as some of the cities are and so it makes it harder for small towns and small businesses to attract workers and keep workers, for that matter,” said Warda.
Russell says solutions have to include increasing the affordable housing supply along with government intervention. He says there’s also a need for higher wages and more well-paying jobs.
“I think we have to recognize the dignity that a decent wage provides to people and how critical that is for community,” he said.
— with files from Robert Lothian/Global News Peterborough
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