The hike to B.C.’s minimum wage is not good news for everyone, according to the Canadian Federation Of Independent Business.
“It would appear to be helping people, but it would do more harm than good,” said B.C. and Alberta vice-president Richard Truscott. “That extra money doesn’t magically appear or disappear for small business owners.”
The province announced on Tuesday it would be raising the minimum wage by 50 cents in September and up to $15 by 2021. The fall increase would take regular minimum wage workers to $11.35 and those who serve liquor to $10.10.
That means costs will be out-of-reach for some already-struggling businesses, according to South Surrey and White Rock Chamber of Commerce executive director Cliff Annable.
“The main business we have are the mom and pop shops,” said Annable. “And the more wages you pay, the more you have to contribute to Canadian Pension Plan and such.”
Smithers Chamber of Commerce president Colin Bateman said the increase of minimum wage will drive the cost of doing business up, but doesn’t think the increase will have an immediate effect on local shops.
“As long as it’s a staggered increase and that they don’t just jump straight to the $15 per hour, I think small businesses should be able to compensate and work with the increases, but things are going to cost more.”
Truscott said a recently-released University of Washington study suggested that what he called “arbitrarily raising” the minimum wage only forces smaller employers to cut back on hours, staff and reduce training programs.
“Why not hike the minimum wage to $25 or $50 and everyone will be better off?” Truscott said. “Fight for 15 makes a good election slogan or snappy chant at a campaign rally, but it’s very difficult to adjust for businesses.”
The latest available data from Statistics Canada suggests the two age groups most likely to earn minimum wage are 15-19 and 35-64 years old, at 39.8 per cent and 24.8 per cent, respectively.