Ontario has recently raised the minimum wage. In a time when many Canadians live paycheque to paycheque, and when the federal Finance Minister tells us to get used to precarious work, the crucial question is: is this enough?
Last month the Ontario government raised the general minimum wage of $11.25 to $11.40, a 15 cent increase. Students and liquor servers have separate minimum wages of $10.70 and $9.90 respectively.
The rationale for paying liquor servers less is based on the assumption that they would make more from tips, and are therefore entitled to less-wages. This is a false assumption as many restaurant owners keep a portion or the whole of the gratuity, and additionally the lower minimum wage makes these workers dependent on the goodwill of their customers.
The student minimum wage applies to student working 28 hours or less when school is in session or during school breaks and holidays. How this is justified is anybody’s guess when not only do students have less time for work; they have also have to pay off increasingly higher tuition loans.
The minimum wage has increased annually since 2014 on the basis of the government- calculated rate of inflation. The crucial question is whether people can actually live on this wage in Ontario. The living wage is often calculated based on the basic necessities required for a healthy family of four, assuming the family has two providers and two children in school or daycare. The Living Wage Canada Network has calculated the living wage for communities across Canada based on this assumption; the average living wage for Ontario turns out to be around $16/hr. Toronto has a higher than average living wage of $18/hr, which is typical for large metropolitan cities.
There is clearly a large gap between this “living wage” and the provincially legislated one. It has to be pointed out that this living wage calculation is a very conservative estimate that doesn’t take into account loan payments, savings for retirement, or mortgage payments. The actual living wage is much higher, especially if we consider the rising property prices across Canada.
Ontario has the largest share of minimum wage workers in Canada; one that has increased fivefold since 1997, according to a study by the Canadian Centre for Policy Alternatives. The study highlights a large increase in temporary work and short-term contracts since 1997, while at the same time traditional unionized manufacturing jobs have been disappearing. This is not all that surprising, since good union jobs have been disappearing across the developed world, including Ontario.
The situation is particularly aggravated in Ontario, which has the highest cost of living in Canada, while at the same time nearly a third of the workforce is paid from $11 to $15 per hour. These worker often face unpredictable work schedules and short hours, often requiring them to take 2 or more jobs to keep afloat. This takes away precious time from their families as well as time and investments needed for career advancement. Nearly one half of minimum wage earners are 25 years old or younger, and are often beset with high tuition loans.
The “Fight for 15” campaign is a positive development that Fightback has actively supported. However a $15 minimum wage is itself inadequate and will be eroded by inflation in the coming years. We would advocate a minimum wage pegged at 2/3rds of the average wage, with annual cost-of- living increases to be determined by a committee made up of elected representatives from the workers, trade unions, unemployed, students and stay-at- home parents.
Beyond raising the minimum wage, we have to reverse the trend of increasing precarious temp work. This must include a fight to expand union representation in the workplace. The unions must organize to penetrate into the largely untapped service sector and other sectors of precarious work. Unions might fight and bargain for the interests of the working class as a whole, not just those workers in more stable organized positions.
The problem of unemployment and precarious employment must also be tackled with a program of public investment and efforts to protect manufacturing jobs from downsizing and offshoring. In the context of crisis, the capitalist system cannot provide this. The capitalists only invest when there is a profit to be made, and constantly press down wages and move production in a never-ending race to the bottom. The fight for good wages and jobs for all is therefore tied closely to the fight for socialism and a democratic planned economy where production is organized for social need and not for the profits of the few.
