By David Whelan (Queen's Park, Toronto) [CC0], via Wikimedia Commons.

On January 1, Ontario, Alberta, and British Columbia saw the minimum wage take a drastic leap from $11.40 per hour to $14 per hour in the first installment of the rollout to ultimately increase minimum wage to a ‘living wage’ of $15 per hour. With a difference of $2.60 overnight and $3.60 in total, this wage increase marks the largest hike in the least amount of time in recent Canadian history, with the second largest hike going from $7.45 to $10.25 — a difference of $2.80. However, the Ontario government allowed a five-year roll out beginning in 2005 and ending in 2010.

In 2018, the second stage of the rollout will be complete, and employees will be making a minimum of $15 per hour. This wage increase is said to give Canadians a ‘living wage’ for those stuck in low-paying jobs in an effort to create more wealth and eradicate poverty. However, economists are not so sure that the desired outcome will look like this. Although some will benefit from the wage hike, it seems that there is a high degree of collateral damage at risk here. First, in the form of layoffs, TD Bank has forecast that due to this wage increase that employers must adhere to, an estimated 90 000 jobs will be lost by 2020 in Ontario alone because many business owners have said that they simply cannot afford to hire or keep staff.

Even large businesses such as Tim Horton’s have made changes in order to accommodate the extra wage per employee, with some locations catching a lot of heat over cutting benefits for employees as well as paid breaks. But while some economists such as York University’s Steven Tufts say that the minimum wage increase will help grow the small business economy by putting more money into the consumers’ pockets, the more general sentiment is that small businesses will need to increase their prices in order to stay afloat.

Arthur spoke with local business owner, Carlo Raponi, about what the future of the business looks like given these new changes.

“One of the things that I have had to reassess is of course, our financial model. The way we currently stand, and if we are able to absorb that cost without raising our prices. And this is what I don’t appreciate about the wage increase. I am all for paying people a living wage, but what I think they did poorly, is the government is executing this rollout too fast.”

Raponi says that because his employees already earned an hourly wage of $13 per hour before the hike, the change is not so drastic for him compared to others. However, Raponi stated that when speaking with other business owners in town, they have expressed real concern about having to scramble and find more business in order to pay their employees more.

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Jordan Porter is a third year political studies student at Trent, and minoring in philosophy. This is Jordan’s third year writing for Arthur, and is now a senior writer while also serving on Arthur’s Board of Directors.