Tina Allan, a bartender, cook and runner at the Orleans Bowling Centre, got a raise on Oct. 1. But it wasn’t because her employer gave her one — it was because the minimum wage went up in Ontario. Now earning $17.60 an hour instead of $17.20, she says the increase was “well overdue.”
The 40-cent raise gives Ontario the second-highest provincial minimum wage. It increases the earnings of about 800,000 workers. It’s the seventh time the province has raised the rate since 2014. Increases are based on the rise in the Ontario Consumer Price Index (CPI).
However, “with the increased cost of living, it doesn’t really make up for it,” Allan, who works full time, said. “I still live at home personally, but for people who have moved out, minimum wage is not enough necessarily to live comfortably.”
For others, for instance those living in an apartment, “you have all these bills. Electricity, your rent, all that stuff that minimum wage barely covers, from what I’m hearing from a lot of people,” she said.
Her co-worker, Kelly Hoban, is a student at uOttawa and works part-time. Hoban said she is from Pennsylvania and given the minimum wage there ($7.25 U.S.), she is “fine” with Ontario’s increase. She will make about $16 more a month.
She works 10-11 hours a week at the centre while also holding a full-time paid co-op position. She said she is saving her full-time cheques for future travel; her part-time cheques cover her daily expenses.
Hoban’s parents pay her rent and tuition and she lives with roommates and uses online textbooks to avoid extra costs.
Here’s how Kelly Hoban’s earnings are affected by minimum wage increase
Based on Kelly Hoban’s part-time shift of 10-11 hours a week, she will make about $16.80 more a month with the 40 cent minimum wage increase. [Chart @ Georgia Looman]
Ricardo Tranjan, a researcher at the Canadian Centre for Policy Alternatives, said that, because the provincial increase reflects inflation, workers aren’t actually getting ahead.
“So whatever they earned last year, with the adjustment to inflation, means that 12 months later they’re earning the same amount in real terms,” Tranjan said. “The problem is that last year they didn’t have an adequate minimum wage, and it wasn’t [adequate] last year or the year before.”
While there are arguments commonly made for keeping minimum wage low — such as that increases will raise inflation or that businesses can’t afford it — Tranjan said they are largely misguided.
“There’s some economic arguments that are made against an increase, but the literature has discredited them almost entirely, or most of them,” Tranjan said. According to a 2017 Bank of Canada study, for instance, a nationwide minimum wage increase of 3.5 per cent would lead to inflation rising by 0.1 per cent.
Tranjan said the increase reflects a pattern in which the Ontario government has not consistently prioritized the needs of low-income workers.
“If you just think about 2018, they froze social assistance rates, they cancelled an approved minimum wage increase, and they lifted rent controls on new units,” Tranjan said. “For low income folk, those are three of the worst things you could have done that have the most negative impact to low income households in Ontario.”
For workers like Allan and Hoban, the increase provides temporary relief, but not a long-term solution. According to the Ontario Living Wage Network, workers in Ottawa should be making at least $22.80 per hour to afford a basic standard of living, as of 2024.
“My parents used to tell me minimum wage when [they] first started working was six [or] seven dollars, but also a cheeseburger at McDonald’s was 10 cents back then compared to the four or five dollars it is now,” said Allan. (A McDonald’s quarter-pounder cost 70 cents in 1972.)
“I’m happy [the government is] starting to … accommodate that a little bit, but I mean, they could do a little bit better.”
