Opinion: Minimum wage hike a success despite gloomy predicti
DrCaleb @ Tue Sep 18, 2018 7:54 am
$1:
Opinion: Minimum wage hike a success despite gloomy predictions
Alberta’s minimum wage was tied for Canada’s lowest when Rachel Notley became premier in May 2015. On Oct. 1 it will rise to $15 an hour — a 47-per-cent hike over three years.
In 2015, the Canadian Federation of Independent Businesses (CFIB) claimed that Alberta’s increase would cost the province “between 53,500 and 195,000 jobs.”
In other words, the CFIB believed that as many as two-thirds of the 300,000 Alberta workers making less than $15 an hour could lose their jobs. In 2017, the C.D. Howe Institute claimed the increase to $15 by 2018 “could lead to the loss of roughly 25,000 jobs.”
History, however, doesn’t back up critics’ sky-is-falling claims. In 2009, Hristos Doucouliagos and T.D. Stanley published a meta-study of 64 U.S. minimum wage studies between 1972 and 2007.
They concluded that minimum-wage increases have no or near-zero effect on employment. In 2016, with the provincial economy still in recession, Alberta’s accommodation and food-service sector and wholesale and retail trade sector, where low-wage jobs are concentrated, added 7,600 jobs.
In 2017, these two sectors added a further 17,400 jobs. These jobs were created despite the minimum wage increasing 33 per cent from 2015 to 2017.
The main reason doom-and-gloom predictions fail to materialize is because critics assume employment effects for teenagers also apply to workers over age 20. In reality, minimum-wage increases tend to result in a small percentage of teens losing their jobs, while losses for adult workers are effectively zero. This is because the vast majority of minimum-wage workers are necessary to businesses, and if employers must cut, they lay off their least-experienced employees.
About 75 per cent of Albertans making less than $15 an hour, however, are not teenagers. In fact, 40 per cent are parents, and over 14,000 are single parents.
Alberta’s minimum wage was tied for Canada’s lowest when Rachel Notley became premier in May 2015. On Oct. 1 it will rise to $15 an hour — a 47-per-cent hike over three years.
In 2015, the Canadian Federation of Independent Businesses (CFIB) claimed that Alberta’s increase would cost the province “between 53,500 and 195,000 jobs.”
In other words, the CFIB believed that as many as two-thirds of the 300,000 Alberta workers making less than $15 an hour could lose their jobs. In 2017, the C.D. Howe Institute claimed the increase to $15 by 2018 “could lead to the loss of roughly 25,000 jobs.”
History, however, doesn’t back up critics’ sky-is-falling claims. In 2009, Hristos Doucouliagos and T.D. Stanley published a meta-study of 64 U.S. minimum wage studies between 1972 and 2007.
They concluded that minimum-wage increases have no or near-zero effect on employment. In 2016, with the provincial economy still in recession, Alberta’s accommodation and food-service sector and wholesale and retail trade sector, where low-wage jobs are concentrated, added 7,600 jobs.
In 2017, these two sectors added a further 17,400 jobs. These jobs were created despite the minimum wage increasing 33 per cent from 2015 to 2017.
The main reason doom-and-gloom predictions fail to materialize is because critics assume employment effects for teenagers also apply to workers over age 20. In reality, minimum-wage increases tend to result in a small percentage of teens losing their jobs, while losses for adult workers are effectively zero. This is because the vast majority of minimum-wage workers are necessary to businesses, and if employers must cut, they lay off their least-experienced employees.
About 75 per cent of Albertans making less than $15 an hour, however, are not teenagers. In fact, 40 per cent are parents, and over 14,000 are single parents.
https://edmontonjournal.com/opinion/col ... redictions
BartSimpson @ Tue Sep 18, 2018 8:29 am
If true then you should end poverty and raise the minimum wage to $100 an hour. 
DrCaleb @ Tue Sep 18, 2018 9:04 am
BartSimpson BartSimpson:
If true then you should end poverty and raise the minimum wage to $100 an hour.
Brilliant! Make all the businesses implode, then everyone will be poor and poverty will be normalized.
BartSimpson @ Tue Sep 18, 2018 9:10 am
DrCaleb DrCaleb:
BartSimpson BartSimpson:
If true then you should end poverty and raise the minimum wage to $100 an hour.
Brilliant! Make all the businesses implode, then everyone will be poor and poverty will be normalized.
Why not?
$1:
They concluded that minimum-wage increases have no or near-zero effect on employment.
If minimum wage increases have 'no or near-zero' effect on employment then why not raise them even higher?
Why not make it $100 an hour?
DrCaleb @ Tue Sep 18, 2018 9:21 am
BartSimpson BartSimpson:
$1:
They concluded that minimum-wage increases have no or near-zero effect on employment.
If minimum wage increases have 'no or near-zero' effect on employment then why not raise them even higher?
Why not make it $100 an hour?
Why not a billion?
Because you know it's a silly suggestion.
Thanos @ Tue Sep 18, 2018 9:24 am
Sort of along the same lines as how banning smoking in restaurants and bars would kill the industry, then a couple of years later it was determined that practically all the places were doing better business just from the new numbers of folks who started to go out for dinner simply because the establishments weren't filled with cigarette smoke anymore. Probably long past time to stop listening to those who put up the loudest arguments against having to do the right thing.
herbie @ Tue Sep 18, 2018 10:06 am
What hurt that industry most is when the gov't gave into the whining and change the meal deduction to 50% years ago.
Used to get taken to lunch by customers I serviced at least twice a week. Then nothing...
The town was booming at the time yet 1/3 of the cafes and restaurants closed. Steping out for a smoke wasn't all that much a concern at diners, it was pubs that got hit. I don't go for a beer nights anymore maybe 3 times a year.
And the minimum wage increase has some side benefits. There seem to be fewer completely useless idiots as employers screen better.
Fuck to be honest, the completely useless twats are down to 75% of staff from 90%...
BartSimpson @ Tue Sep 18, 2018 10:59 am
DrCaleb DrCaleb:
Because you know it's a silly suggestion.
But the premise being floated here is that raising the minimum wage has no noticeable effect on employment so why not raise it further?
If the premise holds true then why not at least $25 an hour?
DrCaleb @ Tue Sep 18, 2018 11:08 am
BartSimpson BartSimpson:
DrCaleb DrCaleb:
Because you know it's a silly suggestion.
But the premise being floated here is that raising the minimum wage has had no noticeable effect on employment so why not raise it further?
If the premise holds true then why not at least $25 an hour?
FTFY.
It's silly because in asking that question you know there is a limit to which business is able to pay and still survive.
$15/h is not that limit. The naysayers were wrong.
bootlegga @ Tue Sep 18, 2018 11:09 am
People certainly have lost jobs because of these hikes. You can find tons of news links where restaurants, shops and services have either shut their doors completely, cut back hours, or stopped hiring altogether.
And sure, not every person earning minimum wage is a teenager, but that's being disingenuous, if not deliberately obtuse. The majority of workers on minimum wage are either youth (15-24) or seniors, and therefore not bread winners in real need of a living wage.
https://web.archive.org/web/20180515184 ... anges.aspx
About 30% of workers on minimum wage fall into the mushy middle, and a fair number of those are working as servers making tips. Some people interviewed even said they don't care about the hikes because they get tips:
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Levi Christensen, a bartender at Denizen Hall, says he hardly notices the minimum wage increase because he relies mainly on tips, which have remained steady.
https://www.cbc.ca/news/canada/edmonton ... -1.4354105
If the goal is to help those 25-54 crowd get out of McJobs, then the solution is better skills training for trades and nursing and other fields where job shortages are looming, not jacking up minimum wage 47% in four years.
Sorry, but every job in Alberta is not a job meant to be a career that a bread winner can work and raise a family on. Unskilled jobs are meant to be transitory and eventually you progress to something better, either a trade/college educated job or perhaps a management role in the service sector (general managers at McDonald's earn between $60-70K). They are also low paid because they are unskilled and therefore less value to society than a plumber or a nurse or a mechanic.
As Bart noted, why not jack up minimum wage to $100/hour? Sure, it's facetious as hell, but he's not far off the mark with that comment. Why stop at $15/hour/hour when the living wage in Edmonton and Calgary are closer to $17/hour? If the goal is to reduce poverty, then why not go to $20 an hour just to be sure?
DrCaleb @ Tue Sep 18, 2018 11:17 am
bootlegga bootlegga:
People certainly have lost jobs because of these hikes. You can find tons of news links where restaurants, shops and services have either shut their doors completely, cut back hours, or stopped hiring altogether.
People have been using that for some time, as if restaurants weren't affected by the oil downturn, and as if they never closed or went out of business before the minimum wage hike.
I don't doubt people lost jobs. But the overall numbers show they found different jobs. Hopefully, they are better off.