Calculating a Living Wage in Peterborough

The Peterborough Social Planning Council published a report earlier this year called “Calculating a Living Wage for Peterborough,” which outlines the minimum ‘living wage’ required in order to meet basic needs and participate in society. Their objective is to educate the greater community about how much it actually costs to live in Peterborough.

According to the report, “The living wage is defined as the minimum hourly wage necessary for each of two workers in a family of four to meet basic needs and to participate in the civic/social life of their community. This means that this ‘reference family,’ with both persons working full time, all year, with no additional income, should be able to afford a specified quality or quantity of housing, food, utilities, transport, health care, and recreation.”

Efforts to conceptualize more inclusionary forms of measuring living standards has been on the rise in recent years. Most notably, these standards are increasingly being thought of in a more comprehensive and multi-layered perspectives instead of only focusing on disposable income.

This attempt to account for the actual living wage necessary to live in Peterborough not only considers the satisfaction of basic needs, but also includes the concept of participation. Participation is defined as the ability of an individual to take an active role in their society.

Social inclusion is another term used throughout the report, and in a sense, the ‘living wage’ is an attempt to highlight the fact that the mere satisfaction of basic needs does not necessarily imply good living standards. It is quite different to live in Toronto than in Peterborough. Therefore, the report makes a strong argument in focusing on the local differentials at play in order to determine the necessary living wage for an individual or family to fully participate in their society.

The report concludes, “For a family/household of four with two wage earners employed full-time at 37.5 hours weekly and two dependents, the living wage is $16.47 (gross per hour for each of the 2 adults in the family of 4).” For a single individual, the living wage is $14.30 per hour. These figures are obviously above the current minimum wage. There were several factors used in the analysis, and ranged from food and housing costs, to recreation and social inclusion costs.

The focus on the local economy and the local community is also a distinctive feature of the report. Instead of relying on grand federal level measures, the report suggests that taking local dynamics into account would be a more efficient and effective approach. This tactic is contested since many argue that regional, national, and international dynamics have a transcendent role in influencing labour wages and conditions.

The report does not focus solely on a specific group when establishing the living wage. It is therefore extremely difficult to decide which expenses to include in the calculations. For instance, in terms of student living, the calculated living wage does not take debt into account, and thus excludes student loans repayments. Some of the other expenses that aren’t included are: owning a house, take-out dinners, pets, poker nights, special dietary needs, cell phones, and smoking/alcohol purchases.

Another compelling argument put forward by the report is that if the wages were to be increased to the living wage, then the local economy would look quite different due to the increased cash flow and subsequent amplified economic activity. If people were to have more disposable income they would not only consume more, but perhaps also even invest, which would boost local economic growth.

All in all, this report takes a leap forward in enabling discussion about what is considered to be a living wage. In a theoretical sense, notions of dignity, participation and social inclusion are key in defining a living wage. The challenge is to reconcile these with the current economic and socio-political structures.

The pictured chart, provided in the report, is a summary of the differences between a minimum wage and a ‘living wage.’