Minimum Wage Debate

Pro: The minimum wage across Canada should be increased to at least $10.00 an hour. This would allow some of the working poor to live above the poverty level.

In some cases, the current minimum wage is not enough to live on, and extra assistance is necessary. In some cases the minimum wage is so low that it encourages people to rely on social assistance. Frank Field talks about this in his book The Minimum Wage: "Indeed, a low paid worker who works full time may in some instances be worse off than if unemployed. This is not because the benefits paid to the unemployed are large; in fact, they are officially regarded as the minimum on which a family can manage to live." (1984: 42) So, there are other reasons for the unemployed being better off than low paid workers. For example, a person on social assistance may make as much as a person who works, but also have the added benefit of a good health care plan and sometimes even transportation and other expenses paid for. In a circumstance such as this, why would anyone take a job at the sacrifice of losing these other valuable resources? They wouldn't. Even if a minimum wage job pays only a fraction more than social assistance, one still needs to factor in other related expenses that will not be taken care of, as it may be on social assistance. Taxes, health care, and many other expenses can be factored into taking money away from the low wage worker, whereas a person on social assistance may have to worry less about these things when it is covered. In some cases, the government has realized that this is the case and has implemented a new "STEP" program to add to the resources of people who want to work, but find that it is better to stay on social assistance for financial reasons. The "STEP" program, in Ontario, allows people on social assistance to work and still receive partial assistance from the government to help bridge the gap that may prohibit them from taking on a low-wage job. In this case, a person could possibly make up to $200 extra dollars than they would if they were working without assistance or only on social assistance. However, this same system is not in place for those on unemployment benefits. In fact many people make more money on unemployment benefits than they would if they were to take a pay cut and look for a low-wage job. Here is where the social safety net falls apart again. What's worse is that these people seldom become able to support themselves totally without some form of assistance, or they end up in a "Poverty Trap", because of their social status.

The minimum wage is characteristic of certain types of people. This is a problem because these people find themselves in a position that they can seldom move out of. Generally, the minimum wage hurts minorities and low wage workers, allowing the rich and powerful to maintain control over the poor for generations. Most minimum wage workers are permanently stuck at minimum wage due to their status: "Overall, individuals working at or below the minimum wage were likely to be women, young people, students and part-time workers. Some were working to finance their education or support their families, while others were older workers looking to supplement their pension." (Statistics Canada, 2003) Immigrants are also a majority of low wage workers left to struggle on minimum wage, even if they have a high education: "Because so many new immigrants are not finding jobs they are qualified for in Canada, they are often forced to find alternate low-paying jobs. According to Statistics Canada, 60 per cent of new immigrants worked in a different field than they had before arriving in Canada." (CBC news: 2004) If not only stuck in a minimum wage job for status reasons, it could also be that some people simply can't risk losing the low paying jobs that they have, out of necessity for survival: "However, some 27,000 heads of family with no spouse were working for minimum wage or less. Although they made up only 5% of all minimum-wage workers, almost all had at least one child under the age of 18 to support. In addition, some 31,000 minimum-wage workers had a spouse who was not employed." (Statistics Canada: 2003) So, the myth that says that minimum wage workers are solely teenagers out to make money for college, doesn't ring true at all. A lot of minimum wage workers have to be able to afford to take care of their families. It could be that there is a single parent at the head of the household, or that only one parent is able to work: "According to Statistics Canada research, single-parent families have an average income of $29,485, almost half of the national average of $43,231." (CBC news: 2004) This causes an important problem, especially in a society where single parent families are on the rise. The low minimum wage accounts for one of the main reasons for child poverty in Canada: "One in six children, or 1,139,000 children, lives in poverty in Canada according to Campaign 2000." (CBC news: 2004) These people live in poverty because they cannot afford to live. The minimum wage is too low. They can not afford childcare for their children so they can work, because childcare costs in most provinces are too much for a minimum wage worker to afford. And that is not the only expense that a minimum wage worker has to worry about. Costs are rising everywhere for everything. Hydro rates just increased, gas rates increased, and even worse shelter costs are often too expensive as well: "According to the Canada Mortgage and Housing Corporation (CMHC) "the cost of adequate shelter should not exceed 30 per cent of household income. Housing which costs less than this is considered affordable." (CBC news: 2004) Even the UN has made a statement on how people in Canada are simply unable to afford shelter costs: "The Committee is concerned that provincial social assistance rates and other income assistance measures have clearly not been adequate to cover rental costs of the poor. In the past five years, the number of tenants paying more than 50 per cent of their income towards rent has increased by 43 per cent." (CBC news: 2004) If the minimum wage is not increased, many people could face homelessness, and the poverty situation will get worse as inflation continues to rise. Many economists believe though, that increasing the minimum wage would bring inflationary pressure and limit economic growth.

Economic factors often leave out some important details and may not be completely accurate. The problem with many of these economic theories is that they can not be scientifically proven. In, The Case of the Minimum Wage, Levin-Waldman discusses how minimum wage is determined more by political and social issues rather than economic ones. This can be seen by the voting trends throughout