Minimum Wage in Canada, by Province

Labour, activists launch campaign on minimum wage

Does increasing the minimum wage by 30 cents actually benefit low-wage earners?

quote:

---

In Nova Scotia, the minimum wage is $7.15 an hour.

And you don't have to consult a guru at the Harvard School of Business to figure out you can't live — or love — on the annual salary that spins off this dizzying figure.

In fact, you can get financial vertigo just thinking about it.

This is particularly true given the changing composition of Canadian households. More of us are now choosing, or being forced, to live alone. That can mean one meagre salary to support a household.

---

However, I disagree with your assertion that people can't get by on 7$ an hour.

Let's do the math:

35 hours a week x 7.00 = 385$
4 weeks in a month = 980$

Now, it's not a lot of money true.

But, for most people it is enough to live on.

While I would like to see the minimum wage raised, I think it is important to differentiate between what people NEED to live on, and the sort of lifestyle a person deserves for working a full-time job.

Without that distinction, one could therefore infer that a person on social assistance should make the same as a person working full-time at minimum wage.

While I think SA rates are too low to live on, in most provinces, I think 980$ is enough to live on.

Debts and loans are a seperate item - and debt relief, particularly student debt relief is accessible.

quote:

---

Originally posted by Palamedes:
However, I disagree with your assertion that people can't get by on 7$ an hour..

---

However, I disagree with your assertion that people can get by on 7$ an hour.. I take it you must still live at home with your parents!

quote:

---

Let's do the math:

35 hours a week x 7.00 = 385$
4 weeks in a month = 980$

Now, it's not a lot of money true.

But, for most people it is enough to live on..

---

35 hours a week x 7.00 = 385$
4 weeks in a month = 980$

Income Tax: 300.00
EI 40.00
Cpp 40.00

980.00 - 380.00 = 600.00

Rent, as one cannot afford one's own accommodation it would have to be shared so I will put room and board at 450.00.

600.00 - 450.00 = 150.00

Bus fair per month as owning a vehicle is not possible. 25.00 per week = 100.00

150.00 - 100.00 = 50.00

So we now have 50 bucks left for dentists, personal necessities, clothes, perscriptions, and and and

It's not a lot of money and for all people it isn't enough to live on.

quote:

---

While I would like to see the minimum wage raised, I think it is important to differentiate between what people NEED to live on, and the sort of lifestyle a person deserves for working a full-time job.

---

Excuse me who decided to make you the designator of lifestyles people deserve who work full time? And why do you think it is important to differentiate, after all the "math" shows us how impossible it is to live on 980.00 per month.

quote:

---

Without that distinction, one could therefore infer that a person on social assistance should make the same as a person working full-time at minimum wage.

---

They should be!

quote:

---

While I think SA rates are too low to live on, in most provinces, I think 980$ is enough to live on.

---

It isn't close to being enough, and you must still live at home with your parents if you think it is.

quote:

---

Debts and loans are a seperate item - and debt relief, particularly student debt relief is accessible.

---

In whose world would this be?

[ 30 December 2006: Message edited by: remind ]

(This does not include eating out.)

Even if a person is sharing a sub-standard one bedroom for about $300 a month (hard to find anything less than $600 a month for a one bedroom), that still does not leave enough money available to properly eat. Add to this, there are utility bills (hydro, gas, etc.), so they can forget even a basic line telephone, which of course is a disaster if you are trying to find better work and need to be easily contacted.

In addition to this being a life of total misery and injustice, as well as just plain un-sustainability, for millions of working Canadians, we need to also consider what this situation does to our economy.

Contrary to the endless stream of lies we keep hearing in the corporate media, it is not capitalists and business bosses that stimulate the economy and create jobs.

Rather it is working people and their constant non-profit investment of consumer dollars back into the economy that creates markets that stimulate economic activity and create jobs.

If people are too poor or stretched to invest money in buying the things they need and/or want, markets shrink, the economy slows, businesses fail, etc.

With wages falling further and further behind prices and the cost of living, especially at the lower end, people obviously have less and less money to re-invest in consumer spending, as well as to pay taxes. So it's no surprise that personal debt is shooting through the roof while personal savings are at record lows, retirement security is disappearing, poverty and homelessness are everywhere, and even a sluggish economic growth rate is considered a "boom."

More and more people are working for lower and lower wages--a trend that's been going on for over 20 years, and it's getting worse.

The only things between our situation now and a major depression are the 50-year record low interest rates (that's why they are being kept so low, despite inflation and devaluation concerns by the major banks). This is why people are borrowing like crazy; maxing out credit cards, etc, just to stay afloat.

But this can't go on forever. It's simply not sustainable. Unless we see a major shift in wealth distribution back toward the working population that creates it in the first place, we will sooner or later face a crash.

It's happened before. It can, and most likely will, happen again.

Income Tax: 311
CPP: 409
Ei: 220

Of course, these are all annual. So, monthly:
Tax: 26$
CPP: 34$
EI: 19$

So, it's about 80$/month as oppposed to the $380 that you have estimated. It would seem that you are rather unfamiliar with the tax process.

There is also the GST rebate - which at that level is 354.00

And, we can add to that, the fact that at least twice a year, there will be three pay periods instead of 2 - adding another 400 or so (after deductions).

So, 980- 80 = 900 monthly.
Plus, an additional 750 annually for emergencies.

It's safe to assume there will be no union dues.

Your estimate for rent seems reasonable.

900.00 - 450.00 = 450.00

Bus fair[sic]per month as owning a vehicle is not possible. 25.00 per week = 100.00

450.00 - 100.00 = 350.00

So we now have 350 bucks left for dentists, personal necessities, clothes, perscriptions, and and and...it's actually not unreasonable as long as you don't live in one of the major centres.

If you live in Toronto or Vancouver - room and board for 450.00/month is unrealistic - and 600.00 might be a better estimate. That would only leave 200 for other expenses. And, I think people should have more than that if they work full time. So, I would agree with raising minimum wage in major cities, based on the cost of rent.

quote:

---

Excuse me who decided to make you the designator of lifestyles people deserve who work full time?

---

You seem to have confused a post on an Internet forum with a coup attempt. This is what people do on the Internet, they post opinions.

quote:

---

And why do you think it is important to differentiate, after all the "math" shows us how impossible it is to live on 980.00 per month.

---

Well, first of all - the math does not show us it is impossible. You can't just make shit up - you can't just throw in 300 in taxes which don't exist and expect people to believe your BS. If you're speaking to government and trying to actually advocate change, you have to make damned sure your numbers are right - or they will see through your inflated numbers and laugh at you.

Secondly, in terms of the differentiation. I am not saying that someone who is working full time should just get by - I am saying they should be doing a little better than that. And, I think someone on SA should be able to get by.

Yes, I think someone working full time should get a little more than someone who is on SA. I guess that makes me an evil person.

.... I think 980$ is enough to live on.

quote:

---

It isn't close to being enough, and you must still live at home with your parents if you think it is.

---

Or perhaps..I know how to calculate taxes.

quote:

---

Originally posted by abnormal:
remind, I'm not arguing with your final conclusions but how do you get income tax of $300 per month on $985 of income? Assuming that the individual earns the same amount every month (i.e, no unpaid time off or overtime) $7 per hour means an annual income of $11,760 - subtract the basic personal exemption of $8,648 and taxable income is, at most, $3,112. A $300 per month tax bill would mean an effective rate of well over 100% - While the provincial tax rate varies by province the combined federal/provincial tax bill should be in the order of $600 per annum (i.e., $50 per month).

Still doesn't leave much to live on but it's a little better than your calculations show.

---

Sorry, I should have detailed it better, and thank you for asking so I could clarify. I was actually being very loose with labeling it income tax, and perhaps should have explained that further. What I used was an average of about 30% of our wages off and labelled it income tax. This was to simplify "the math" paid in taxes, of every variety, that we pay off the top of our pay cheques.

quote:

---

Employers and customers need to recognize retail workers play an essential role within Canada’s economy and their contribution and value of the work they do, requires fair acknowledgement.

---

What does this mean exactly? What workers don't play an essential role? What contributions don't require fair acknowledgement?

Shouldn't this just apply to all workers? Given, that no matter how you re-arrange things - there will always be someone at the bottom of the wage hierarchy - who exactly should be on the bottom?

quote:

---

Originally posted by Palamedes:
Alright, let's examine your numbers:
I've plugged the numbers into the Ontario tax calculator:

Or perhaps..I know how to calculate taxes.

So, in your opinion - everyone should be getting 1500$ from the government and the people on SA should be getting the same amount as people on minimum wage?

---

Please see my other post that crossed posted with yours. In BC we also pay provincial income tax BTW. You don't in ON?

My estimates of CPP and EI were a bit high but not that much to make any real difference and perhaps compensate a bit for my low rent estimate.

quote:

---

Please see my other post that crossed posted with yours. In BC we also pay provincial income tax BTW. You don't in ON?

---

Ontario has provincial income tax, as does BC - but the threshold for paying provincial tax is above 12,000 - as it is in BC.

quote:

---

My estimates of CPP and EI were a bit high but not that much to make any real difference"

---

300$/month is not that much to make any real difference? Sorry, I beg to differ. Go tell a single mother that $300 a month doesn't make any real difference.

quote:

---

But I stand by by my 30% figures for taxation off our the top of incomes no matter what form it comes in.

---

Well, that's just plain innaccurate. The 30% figure is an average. Obviously, you have to account for the fact that people with lower wages are going to pay less taxes. Why don't you spell out how exactly it's possibe for someone making $1000 a month is going to pay $300 in taxes - of any kind.

quote:

---

It would probably save us money in administration costs if we had a flat tax of 30-35% and no others.

---

This is a completely idiotic idea and something I have never heard anyone argue for except for American neo-cons. There is a reason it's called a 'progressive' tax - and that is so the wealthy pay a higher percentage than those that don't make as much. Your flat tax proposal would set us back about 100 years, in terms of social progress.

[ 30 December 2006: Message edited by: Palamedes ]

Here is a summary of data from 2005:

quote:

---

Percentage of employees who were paid minimum wage: 4.3

Percentage of minimum-wage workers who were
- working part-time: 59.2
- between 15 and 19 years old: 44.5
- students living at home: 33.2
- heads of a household with children under 18: 5.4

---

I did some reading about the link between minimum wages, employment and poverty, and wrote it up here.

The bottom line (and it's worth taking the time to read the part above the bottom line):

quote:

---

* When minimum wages are 'low' - say, less than 40% of the average hourly wage - then moderate increases won't have a significant short-run effect on employment.
* When minimum wages are around 45% of the average, they significantly reduce employment.
* No-one has been able to find any evidence to suggest that increasing the minimum wage has a measurable effect on reducing poverty.

---

quote:

---

Percentage of employees who were paid minimum wage: 4.3

---

Since, such a small percentage of workers are paid so little, then this barely effects employers at all and I'm sure that they won't mind.

quote:

---

Percentage of minimum-wage workers who were
- working part-time: 59.2
- between 15 and 19 years old: 44.5

---

So, over 40% of minimum wage workers are working full time - and 55% are adults.

quote:

---

When minimum wages are 'low' - say, less than 40% of the average hourly wage - then moderate increases won't have a significant short-run effect on employment.

---

Interesting to compare minimum wage to average wage. I think it's a good idea to compare the two together. In Ontario, the average wage is 20.86. So 40% would be 8.36. I think that is reasonable. Of course, you could alter it on a municipal basis - in areas where the cost of living is much higher.

"When minimum wages are around 45% of the average, they significantly reduce employment."

I find this hard to believe given that less than 5% of the population is on minimum wage.

"No-one has been able to find any evidence to suggest that increasing the minimum wage has a measurable effect on reducing poverty. "

Well, even if that is so - that really only measures the people that go from under the line to over the line. There are still people that are below the poverty line that get a little more but are still under - and there are also people that are just over the line - and move even a little more. The fact of the matter is that for everyone who is helped by it, they are better off - and they likely need the money. If no one is helped by it, then clearly businesses aren't being hurt at all.

quote:

---

A far more effective program would be something along the lines of an earned income tax credit. Playing around with the minumum wage is either counter-productive or pointless.

---

Well, in our example, taxes were only $300 a year, so I'm not really sure how much differene that would make - particularly when government relies on the fact that many people are too intimidated by the tax forms to file - thus allowing even more people to not get that rebate.

quote:

---

Just because your wage is lower than anothers does not mean you do not lose 30% of take home wage to taxation just as high wage income doers do. In fact, a case could be made that low income earners, who spend every last cent they have to live, for sure do pay the estimated 30% taxation, that you say only higher income earners pay.

---

I must be missing something, because I can not fathom a way in which a person who makes 1000$ a month pays 300$ in taxes in Canada. Please tell me what taxes that person will be paying so that I can understand. The fact of the matter is that high income earners pay a higher percentage of their income - as it should be.(and in this particular case, a much higher percentage).

quote:

---

Low income earners by having to spend all they have do not have savings.

---

quote:

---

Originally posted by Palamedes:
Minimum wage is not just about alleviating poverty - it is also about seeing a more fair distribution of wealth and income.

---

quote:

---

This 30% is based on the premise that we pay about 33% of our wages into taxaton of all types. In my example, about 3% would be covered in room and board payments for school taxes, so I figured 30% a taxation ratio would be fair. But I am open to discussion about the the 30% off the top with all forms of taxation included, it could even be higher.

---

quote:

---

Originally posted by Palamedes:
Please tell me what taxes that person will be paying so that I can understand.

---

Income Tax
Property Tax
School Tax
Water Tax
Sewer Tax
Environmental taxes levied on everything from transportation costs, hydro/utility bills, to garbage disposal

GST on all most all of the disposable income
PST on all most all of the disposable income

Boarder Tariffs/taxes on imported produce and other food products (included in the price to the consumer is where the tax of course is)

And I am sure I am missing a few more hidden taxes that we pay for as they are included in the products we buy.

quote:

---

Originally posted by abnormal:
remind,

You're simply reinforcing the point - if you want to take taxes "off the top" you've got to reduce all the other expenses proportionately.

---

I know this, and have worked it out several ways and I still repeat that you lose 30%, no matter your income, off the top of your wages in taxation.

The following is a mock tax trail income expenditure on the I just researched actual costs on line and called a couple of places:

GVA – single woman in early 20’s
Jen is making 8.50 per hour at 37 hrs per week and feels fortunate to be getting 37 hours most retail jobs are 32 hours per week.

Jen’s gross monthly income is 1258.00 or 15,096.00 per year

15,096.00
785.00 Income tax
-73.00 BC Tax Credit
574.00 CPP
282.00 EI
13, 527.00 Take home for Jen for 2006

or 1,127.25 per month take home 10% average gone
720.00 is the cost of R&B(that’s is an
average it seems to be from 650.00
to 780.00 depending on what is
included and area) So, this 720.00
all included except meals you can’t
make, no brown bags made up if you
miss a meal you miss a meal. Taxes
for property school, water sewer,
environmental levies GST PST
included. Jen pays 2/3rds of her
income on accommodation. 1/3rd of
that 720.00 the landlord takes in
goes out to pay taxes incurred as
business costs. Follow the
percentages 10% lost off top, 15%
lost in accomodation associated taxes

407.00 Left for Jen after rent
216.00 Transportation costs per month as Jen
has to travel 4 zones each way
Taxes of about 20% appear to be
included in translink prices there
could be hidden 5% of that money has
gone to taxes

191.00 Left for Jen after trans costs
100.00 For food costs, hidden taxes in the
pricing to cover business taxes as
expense as with landlord 10% goes to
taxes
10.40 Direct Tax 14% on this fast food GST
PST.
80.60 Left for Jen after food requirements
20.00 per month mandatory feminine supplies
2.80 Direct Tax 14% (but remember the
product has both hidden taxes of about
5% and the product costs bears a % of
the costs of the taxes the business
owner has to pay which can be from 10%- 15% of product cost, and this is the
case with everything purchased
57.80 Left for Jen
30.00 toiletries, soap, shampoo,
conditioner, toothpaste toothbrush,
deodorant, Razor blades etc
4.20 Direct Tax of 14 % Hidden tax and/or
Tax cost coverage for business 5-15%
in pricing costs
25.80 Jen has left
3.61 Direct tax of 14% because whatever Jen
spends here money on will have Pst Gst
22.19 Jen gets for dentists, clothes, shoes,
underwear etc per month all containing
5-15% of hidden taxes and or tax cost
coverage for business owner.

You can see through all these examples how 30% of our income goes to taxation no matter the level of income. I hope that is a clear enough break down of where the 30% comes from both in my figures and The Fraser Institute even supports a 30% figure.

Now after all this doing “the math”

The Fraser institute link says that a person making 21k pays 7,904.00 in taxes in 1 year they don’t figure any lower than 21k is why I used it as a starting point both forwards and backwards.

It seems that you pay about 142.00 dollars in taxes for every extra k earned. This formula means that on 15,096.00 wages per year, a person pays about 5917.00 taxes in a year Oh, now what would that be? Oh yes, over 30% in taxes off the top of a minimum wage worker in BC.

Well, we discussed income tax. I have never heard of school tax. Water and sewage taxes are generally included in your rent, unless you own property. And, I think it is a fair assumption to suggest that minimum wage earners don't own property. So, I think adding water, sewage and property tax is a bit unneccessary.

quote:

---

Environmental taxes levied on everything from transportation costs, hydro/utility bills, to garbage disposal"

---

Well, again these are all things that we have already covered. The 100 spent on transit already covers the transport costs. And you've already mentioned the water tax.

quote:

---

GST on all most all of the disposable income
PST on all most all of the disposable income

---

Well, other than food and necessities true. But it still isn't that much - and while it may be a tax - I think when we suggest that they have $300 a monthy leftover to spend - we're thinking of their spending in terms of the prices which include these taxes.

quote:

---

Boarder Tariffs/taxes on imported produce and other food products (included in the price to the consumer is where the tax of course is)

---

Well, again, these are built-in taxes.

quote:

---

And I am sure I am missing a few more hidden taxes that we pay for as they are included in the products we buy.

---

But we don't actually pay those taxes. The businesses pay those taxes, and increase their prices accordingly. While it might be valid if you were a Fraser Institute crony trying to show how over-taxed we are - it isn't really relevant in showing how someone on minimum wage has no money left to spend.

quote:

---

I am actually going to go off and make a similar docudrama of person in BC making min wage like which this topic was originally started upon with the gal from the maritimes. To see if your premise is indeed correct, or indeed if my depiction is.

---

Good for you. I would very much like to see it when you are done. Now, I have seen many reports done showing how the wage is too low - but they often make the mistake of egregiously overestimating some expenses (taking the highest possible price for everything) and/or building in things to the model which are clearly not necessary - ie a car and related expenses.

I think you would find better luck exploring those that are expected to live on the pitiful amount provided for social assistance.

quote:

---

Will come with when done, as maybe I am and everyone else who feels a single person cannot live on 980.00 per month or the provincial equivalent.

---

quote:

---

Originally posted by Palamedes:
Remind:

Well, we discussed income tax. I have never heard of school tax. Water and sewage taxes are generally included in your rent, unless you own property. And, I think it is a fair assumption to suggest that minimum wage earners don't own property. So, I think adding water, sewage and property tax is a bit unneccessary.)

---

Actually, no meades you're quite wrong, it has to be calculated in, that is how rent and cost coverage is determined. When you pay rent your rent is calculated to cover ALL those things and more, no if ands or buts.

quote:

---

Well, again these are all things that we have already covered. The 100 spent on transit already covers the transport costs. And you've already mentioned the water tax.

---

It was 266.00 spent on transport costs which included tax, so a portion, actually 1/3 of transit costs are taxes. Never mentioned water again there. (oops, I see you were still on the other formula I posted, that admittedly was inaccurate in some areas, but not in the end result. I.e really low balled transit and Room and Board costs.)

quote:

---

But we don't actually pay those taxes. The businesses pay those taxes, and increase their prices accordingly

---

What do you mean we don't actually pay those taxes you just said yourself we pay those taxes. The business owner raises their prices accordingly, so the consumer pays their, the business owner's tax burden, as well as their own.

quote:

---

I think you would find better luck exploring those that are expected to live on the pitiful amount provided for social assistance.

Would love to see it, let me know when you are done, or if you need any help to make it more legitimate in the eyes of the decision makers (deputy ministers etc)

---

The formating did not transfer well. And the consumer products were low balled not high averaged, The accommodation costs and transportation are actual representation of a min wage worker pay and their expenses plus taxes based upon a 37 hr work week.

Social assistance peoples do an incredible job of living on air. Hats off to them and they should not have to be struggling so there should be a mandatory min month wage, or tax credits to the threshhold or above.

Edited to add:

Every property owner pays school tax, multple occupancy places on one property has the owner paying higher school taxes.

[ 30 December 2006: Message edited by: remind ]

quote:

---

And since by your own admission, you make a decent amount more than minimum wage, I would like to see your budget - in which you can not get by.

---

Well, let's see. Looking back to a month ago when I was living in Ottawa, working retail full time, my expenses were as follows:

$450.00 for rent (this was living with a roomie, if I was forced to live alone my rent expense would be in the range of $600.00)

$75.00 for public transportation, since I don't drive, and was no longer a student, therefor not eligible for OC Transpo's student discount.

$30.00 per week on food, so $120.00 per month.

$25.00 on a landline, but once again, that's split between two people, so it generally would be $50 for one person.

Internet/Cable might not seem like a necessity, but I've got to factor those into my budget, because as a journalism student they were both pretty much considered "required" reading.

And so on, and so forth...

My lifestyle isn't lavish. I don't spend money on frivilous things, but still have to dip into loans from time to time to make ends meet.

quote:

---

I think it is important to differentiate between what people NEED to live on, and the sort of lifestyle a person deserves for working a full-time job.

---

quote:

---

Originally posted by Stephen Gordon:
* When minimum wages are 'low' - say, less than 40% of the average hourly wage - then moderate increases won't have a significant short-run effect on employment.
* When minimum wages are around 45% of the average, they significantly reduce employment.
* No-one has been able to find any evidence to suggest that increasing the minimum wage has a measurable effect on reducing poverty.

---

But minimum wage in New Zealand is 50 percent of the average. And min wage is about $11 dollars CDN in Australia. I wonder what min wage workers in those countries would have to say about taking a several dollar an hour wage cut if they lived in Canada ?. And it's a lot colder here in this frozen Puerto Rico du Nord, too.

[ 30 December 2006: Message edited by: Fidel ]

quote:

---

You can see through all these examples how 30% of our income goes to taxation no matter the level of income. I hope that is a clear enough break down of where the 30% comes from both in my figures and The Fraser Institute even supports a 30% figure.

Now after all this doing “the math”

The Fraser institute link says that a person making 21k pays 7,904.00 in taxes in 1 year they don’t figure any lower than 21k is why I used it as a starting point both forwards and backwards.

It seems that you pay about 142.00 dollars in taxes for every extra k earned. This formula means that on 15,096.00 wages per year, a person pays about 5917.00 taxes in a year Oh, now what would that be? Oh yes, over 30% in taxes off the top of a minimum wage worker in BC.

---

quote:

---

Originally posted by abnormal:
I'm not arguing that. The question becomes "how are you adjusting expenses to reflect the fact that you've already deducted the tax component?"

---

You're deducting taxes up front (30%) but that tax load includes taxes paid to all levels of government. For example, property taxes are included in rent - if you're going to deduct that component of taxes from income up front, you have to reduce rent by a corresponding amount (I have no idea what the right number is). Otherwise you're double counting the cost of property tax - once in the 30% deduction and a second time when you figure in the cost of rent.

Gasoline or cigarettes are probably obvious examples - a very significant percentage of the purchase price is tax. That tax figures into the Fraser Institute's calculations. Again, if you want to use the 30% tax rate fine, but you have to reduce the cost of these items proportionately (I know, people living on minimum wage are unlikely to buy much gas but it's a simple example).

The same goes for any and all consumption taxes.

quote:

---

But renters not only pay their share of the taxes, they pay a portion of the landlords share of the taxes as well.

---

True - so if you want to deduct that income up front you have to deduct it from the rent.

The same goes for all other expenses.

I think the point you're trying to illustrate is much easier to make if you use out of pocket numbers (i.e., income is $980, taxes are $80, rent is $X, etc,) rather than try to go through a calculation that looks like "income is $980, taxes are $300, rent is two thirds of $X, and so forth". The latter approach includes a number of approximations that are at best difficult to justify.

quote:

---

Originally posted by abnormal:
how do you address the various adjustments to expenses?

---

quote:

---

A sizeable proportion (28%) of minimum wage workers
were aged 25 to 54, many of them women. For
these individuals in their core working and peak earning
years, minimum wage work is likely not a transitory
phase.

---

[URL] http://www.fiscalpolicy.org/press_040421.stm [/URL]
[URL] http://www.fiscalpolicy.org/minimumwageandsmallbusiness.pdf [/URL]

The Economic Policy Institute, one of the most recognized economic think tanks in the world, largely supports this finding, and adds that while higher minimum wages don’t focus exclusively on the working poor as individuals, they are still the main beneficiaries of these increases.

[URL] http://www.epinet.org/content.cfm/webfeatures_snapshots_07192004 [/URL]

Here’s also some research quoting US government figures by the Michigan Campaign for Minimum Wage, and why they think higher minimum wages are a good idea:

[URL] http://www.higherminimumwage.com/stats.html [/URL]

And here’s more from the EPI linking to the US Department of Labor (why are we all using US figures) on the whole minimum wage structure, who gets and how it helps them.

[URL] http://www.epinet.org/content.cfm/issueguides_minwage [/URL]

Again, I’m not saying that it does a great deal to reduce poverty, or that everyone working at minimum wage is primarily dependent on that wage for survival—and I do agree that the Scandinavian model on this is much better. But you should appreciate that most of the credible evidence out there shows that there is an overall net benefit to people and the economy by raising the minimum wage.

Since the data shows that the majority of minimum wage earners are to one degree or another in poverty, then you can't deny raising the minimum wage would help those people.

We should also point out that, according to data I have read from reports by the BC Central Credit Union, minimum wage hikes tend, over time, to motivate increases to wages, especially at the lower pay scales, in general.

[URL] http://www.cucbc.com/ [/URL]
(don't have a direct link to their reports, but they do post summaries in their news sections)

That's definitely a good thing, since it puts more money into workers' pockets, and since workers account for the vast majority of consumer spending that creates markets, it's a real economic boost.

quote:

---

Originally posted by Steppenwolf Allende:
Since the data shows that the majority of minimum wage earners are to one degree or another in poverty, then you can't deny raising the minimum wage would help those people.

---

Not in Canada. UBC's Nicole Fortin and Thomas Lemieux looked at the data in

quote:

---

Originally posted by Steppenwolf Allende:
Yet if you look to the overwhelming evidence linked to in this post, from a similar debate here about a couple months ago, shows that in fact minimum wage increases generally do, to one degree or another, help alleviate poverty:[...]

Since the data shows that the majority of minimum wage earners are to one degree or another in poverty, then you can't deny raising the minimum wage would help those people. [...]

Besides, it's a fact that minimum wage rates as they are fall below the poverty line in terms of living standards. That alone is reason enough to raise them.

---

While many of your points are good, SA, these ones are not.

The movement to raise the minimum wage has nothing to do with poverty. It is aimed at raising the floor on exploitation of workers by employers, and reducing the detrimental effects of competition among workers for available jobs.

Poverty is not primarily an issue of employment, and it cannot be addressed in any significant way by increasing the minimum wage. The appropriate means of addressing it include (but are not limited to) full employment policies aimed at those who can work, generous social assistance of various types for those who cannot, child care, health care, pharmacare, low-cost housing, and providing as many essential goods and services as possible free of charge.

Unionist:

Why are you differentiating between those that can work and those that can not?

Are you suggesting that those that can work should not be given social assistance?

quote:

---

Originally posted by Palamedes:
[QB]Alright, let's examine your numbers:
I've plugged the numbers into the Ontario tax calculator:

Income Tax: 311
CPP: 409
Ei: 220

Of course, these are all annual. So, monthly:
Tax: 26$
CPP: 34$
EI: 19$

So, it's about 80$/month as oppposed to the $380 that you have estimated. It would seem that you are rather unfamiliar with the tax process.

---

quote:

---

Originally posted by Palamedes:
"generous social assistance of various types for those who cannot"

Unionist:

Why are you differentiating between those that can work and those that can not?

Are you suggesting that those that can work should not be given social assistance?

Or, are you just suggesting that it should be less generous?

---

quote:

---

So we now have 350 bucks left for dentists, personal necessities, clothes, perscriptions, and and and

---

quote:

---

Originally posted by jas:
Wow, that's some calculator! $26/month income tax on $980! No wonder so many people live in Ontario. In the rest of the country we pay 16% federal and a further portion provincial.

---

You pay zero federal income tax on the first $8648.00 you earn: that is your "personal exemption". Most provinces set the personal exemption at about the same place. Suppose you earn $980 per month. That comes to $11760 per year. You do not pay 16% of $11760 in federal income tax: rather, you pay 16% of $11760 - $8648. So you pay 16% of $3112. In other words, in each province, a person earning $980 per month pays $497.92 in federal income tax per year, i.e. $41.49 per month. Of course, you have to add provincial income tax to that as well. That varies from province to province. I'm guessing an average of about half the federal tax, for a total of about $60 per month in income tax. I am only talking income tax here, not GST, PST, etc. Are my numbers off?

[ 02 January 2007: Message edited by: Martha (but not Stewart) ]

Even if there are no other deductions, everyone is eligible for the base amount of 8,800. So, with an income of 11,760 - once you subtract the 8,800 - there is only 2960 left to pay tax on.

With no other deductions, that works out to 37.61 per month in federal income tax. I'm not sure how the rest of the calculations are done, but I assume that there are some other credits that kick in that are accounted for in the calculator.

As for provincial tax, again - there are a certain amount of allowable deductions - and they have enough deductions that the threshold for paying tax, is just above that in our scenario.

I'm not exaclty sure how the calculator works. Anyways, here is the link if you want to try it:

http://www.taxtips.ca/calculators.htm#

Martha: krap, you've made my post redundant.

Unionist: you're not answering the question.

I have been watching someone who works retail basically wither under the constant stress of not being able to make ends meet, being harrassed as a woman by male customers and ignored by male employees,not consistently able to afford prescriptions, and unable to save money to do anything much of interest so that life seems like a bleak endless monotony.

I'm not really sure how this is relevant. Minimum wage isn't going to change that. If the job is abusive - they can get a new one or file a complaint. If where they are living is abusive - there are plenty of shelters for just that sort of thing until they are on their feet. The fact that they have a job puts them ahead of many.

"the ability to engage in meaninful recreational, intellectual, social or political activity may be hindered"

I'm not sure what meaningful recreational activity is. But, as for the other two, I don't know why they would be hindered unless you are counting the Liberal convention fee. There are plenty of ways to participate that are not particularly expensive.

"and homelessness may be a constant worry"

I don't really see why it would be. People on social assistance ($520) generally avoid homelessness - so I'm not sure why someone with a job with a net income of $900 or more a month would be homeless.

"but Until they don't"

So, now you're suggesting that people on minimum wage are in risk of dying?

"I have been watching someone who works retail basically wither under the constant stress of not being able to make ends meet,"

Well, even if she is getting minimum wage, there may be government programs to help her if she has children, or special needs.

"being harrassed as a woman by male customers"

Well, again - I don't see what this has to do with minimum wage. There are channels to make complaints against employees being exposed to such conditions - although I have to say it seems odd that male customers continually harass her in a non-alcohol environment.

"and ignored by male employees"

Is this because male employees don't want the inclusion of women in the male-dominated retail industry? You can't legislate people being your friend. You can leave, if you don't like it.

"consistently able to afford prescriptions"

Well, this is a legitimate point - although I think that making certain prescriptions free (just like our healthcare system) - is the way to go, as opposed to other fixes to address this problem.

"unable to save money to do anything much of interest so that life seems like a bleak endless monotony"

Fair enough - it's a shit life - although many times better than what it would have been like living a hundred years ago - working 7 days a week, 12 hours a day on the farm. And, I would like to see every Canadian that is working full time be able to have a better life. But, let's not make the argument ridiculous by saying that there is no way that someone making min wage can survive- because it absolutely isn't true.

[ 02 January 2007: Message edited by: Palamedes ]

quote:

---

Originally posted by unionist:

I'm suggesting that we should strive for a society where decent jobs are available for all who are able to work. I do, however, expect that in the struggle for such a society, there will be those that try to introduce detours.

---

I think full employment would have been a fantastic idea in the 1970s. Before stagflation was incorrectly blamed on overly generous social program spending leading up to Milton Friedman's era to fix what wasn't broken, more people chose to work in the first half of the 1970's and not collect what were more generous dole and social welfare benefits compared with the 1980's, when "EI" was slashed and made less available to the unemployed.

I don't believe ordinary people choose unemployment or to sponge off society. Most people want to work and earn a decent income.

quote:

---

The outstanding discovery of recent historical and anthropological research is that man's economy, as a rule, is submerged in his social relationships. He does not act so as to safeguard his individual interest in the possession of material goods; he acts so as to safeguard his social standing, his social claims, his social assets." -- (Karl Polanyi, The Great Transformation, 1944)

---

But I think something else has to be factored into the jobs for the sake of jobism situation, global warming. At the risk of sounding like Roddy McDowell in an old sci-fi movie, it's not a question of averting unnatural disaster. Disaster is upon us now. It might be cheaper in the near term to pay people to stay home and not contribute to global warming until governments are committed to transforming the global economy into something sustainable.

[ 02 January 2007: Message edited by: Fidel ]

quote:

---

quote:
--------------------------------------------------------------------------------
Originally posted by abnormal:
how do you address the various adjustments to expenses?
--------------------------------------------------------------------------------

It's called doing without or getting a present from the family.

---

I assume this is tongue in cheek - my sarcasm detector isn't working well tonite. If this was intended to be humourous, my apologies.

The point is, you're gone through an exercise that shows that minimum wage isn't enough to live on and one of the first things that you did was to deduct $300 in taxes - that $300 is an approximation of all taxes paid to all levels of government which means it includes all taxes included in the various expense items you list. However, if 30% of rent for example consists of some sort of tax load you can't deduct the full rent - you can only use 70% of it. Otherwise you've just double counted 30% of rent. And so forth.

First of two posts—this one addressing the study linked to by Prof. Gordon. He points to studies that show Canada’s minimum wage situation is quite a bit different than in the US, which was where the studies I was using are from.

quote:

---

Not in Canada. UBC's Nicole Fortin and Thomas Lemieux looked at the data in
this study. They find that 26.4% of minimum wage workers were from households in the bottom two income deciles (there's no official poverty line in Canada, so I'm using that).

---

But wait a minute. First off, everyone seems to agree that, regardless of what percentage of minimum wage workers actually depend on that wage for survival (therefore living in poverty), minimum wage increases do help those people who are. So, right off, it makes sense to raise the minimum wage for those people.

Second, I don’t think that study gives a full picture of what’s going on out there in terms of poverty and the minimum wage—not because there’s anything wrong with the study itself (these folks are obviously not Fraser Institute nut bars), but because it seems to take the fact that many minimum wage workers are living at home with family and thus have other financial supports for granted that minimum wage increases aren’t important.

I really don’t think that’s the case. If we look at a recent report by the CCPA, we see that just because many minimum wage workers are living with family (especially younger folks) does not mean that low wage rates are enough to satisfy their basic needs at that level. For example, the low rates, when compared to skyrocketing tuition, make it almost impossible, even when living at home, to work up enough cash to cover the cost. Of course, I’m sure their parents will try to help them. But still, that puts an extra burden on the household income that clearly need not be there. It’s long been established that lack of access to higher education is a big contributing factor to poverty.

Also, both the CCPA findings and Gordon’s UBC study show that the majority of minimum wage earners living at home are not from high income families, but rather from mid-to-low income families, meaning that the low wage rates obviously put a burden of support on household income that is already compromised. That, as far as I can tell, contributes to poverty and insecurity as well. They also point out that the those in greatest need—single parents—are among those suffering the most from low minimum wage rates.

quote:

---

The movement to raise the minimum wage has nothing to do with poverty. It is aimed at raising the floor on exploitation of workers by employers, and reducing the detrimental effects of competition among workers for available jobs.

---

Hold on. It seems that both the studies linked to above show that, at least to varying degrees in varying sectors of the workforce, low minimum wages do contribute to poverty. Also, history clearly shows that exploitation of labour and forcing workers to compete for scarce jobs, especially in the lower skilled sectors, have always been major causes or contributors to poverty and repression.

Add to this, both the CCPA study and the reports from the BC Central Credit Union show that minimum wage hikes put workers in higher wage categories across most economic sectors in a better position to raise their wage rates as well. That certainly does help alleviate poverty.

I don't see how these can be separated from one another in the economy.

quote:

---

Poverty is not primarily an issue of employment, and it cannot be addressed in any significant way by increasing the minimum wage. The appropriate means of addressing it include (but are not limited to) full employment policies aimed at those who can work, generous social assistance of various types for those who cannot, child care, health care, pharmacare, low-cost housing, and providing as many essential goods and services as possible free of charge.

---

All these reforms have repeatedly shown themselves to be effective, to varying degrees, in alleviating poverty, and still do in a great many ways--no qualms there at all.

I also would add that by far the most successful, yet least discussed measures, involve democratizing our businesses and economies (unionization, worker-run businesses and various cooperative ventures, labour-sponsored and community-based enterprises and similar socialistic plans), which have repeatedly shown themselves to be very successful in areas where they have been applied. But more on that later.

But I did say that raising minimum economic standards, including minimum wages, are also an essential part, but only a part, of a broader social reform network in fighting poverty.

quote:

---

Why not confine them to the old bogeyperson that "higher wages kill jobs". It looks better on them!

---

Well, dispelling these sleazy corporatist lies is as easy as breathing.

The fact is history is chalk full of proof that rising wages, benefits, rights and security from unionization and the usual complimentary even modest social democratic reforms have hugely boosted living standards, vastly improved working conditions, expanded and entrenched democratic rights and strengthened the health, education, equality and prosperity of people everywhere without exception.

Europe and North America are by far the best examples.

Report after report after report after report after report show unequivocally that rising wages and working conditions and freedoms brought about by the vast spread of unionization and complimentary New Deal type social reforms (like some of those you mention) fought for by unions effectively, albeit moderately, redistributed great amounts of wealth back to the working people who created it in the first place, and this led to the biggest economic boom and sustained rise in living standards and prosperity in human history--to the point of where, for the first time, the majority people in these parts of the world were no longer living in poverty and scarcity.

When these neo-con corporate brown-nosers attack these measures and push their oppressive trickle-down corporatist stupidity, they are pretty much the same as neo-Nazis and holocaust deniers, relying on outright lies and suppression of history to promote themselves.

[ 04 January 2007: Message edited by: Steppenwolf Allende ]

But, here are some of the reasons that the effect may not be more dramatic than it is.

Most poverty measures in Canada are relative to the average wage. Therefore, if everyone's wage in Canada were to double while prices remained the same - thus PPP doubled - you would actually have more poverty - as crazy as it seems.

So, when minimum wage goes up, there is a ripple effect which means all wages go up to a lesser degree - thus raising the threshold on what poverty is.

I think a measure based on a 'fixed basket of goods' would give us a better view of 'absolute' poverty rather than relative poverty.

quote:

---

Originally posted by bruce_the_vii:
I think it's useful to remember when talking about minimum wage that Canada is an immigration country, has a surplus of jobs. This means than if mimimum wage increases costs jobs all you have to do is adjust the immigration quota. In particular this applies to growth cities.

---

the fact that Canada has a surplus of jobs is always dropped out of the arguement for a higher minimum wage including by economists. In todays Toronto Star they have an article about the increase on minimum wage to $8.00 an hour complete with the lament by Liberal and Conservative leaders that to raise it to $10 would cost too many jobs.

One reads about the economy in Calgary and Lethbridge at this time and how Tim Hortons has to pay $14 an hour. In fact all the cities of Southern Ontarion would be in that boat by this time, 2007, if immigration had been related to the unemployment figure -- which it is not. And that, my boy, is the thesis.

[ 04 January 2007: Message edited by: bruce_the_vii ]

[ 04 January 2007: Message edited by: bruce_the_vii ]

There are some 1.7 million retails workers in Canada. About 1 in 10 workers.

The modern life style is characterized by frivilous purchases. This could be changed without anyone noticing. The bad employers could be ditched.