Ontario’s minimum wage hike: The job is half finished

October 1, 2015

TORONTO – October 1st marks the first year in which the Ontario government adjusts its provincial minimum wage to inflation, but the job is only half finished, says a study from the Canadian Centre for Policy Alternatives’ Ontario office (CCPA-Ontario).

Raising the Bar: Revisiting the Benchmark Question for Ontario’s Minimum Wage, published in partnership with the Poverty and Employment Precarity in Southern Ontario (PEPSO) project, says indexing minimum wage to inflation is a good first step but only half the job. 

“In June of 2013, the provincial government mandated a commissioned panel to answer the question: how should the minimum wage be determined in the future?” says CCPA-Ontario Economist Kaylie Tiessen, who authored Raising the Bar. “More than two years later that mandate remains only partially complete — despite the rise of precarious work that has been documented by the PEPSO project.”

Among the findings in the report:

  • While increasing Ontario’s minimum wage to $11.25 — up from $11 an hour — will allow it to keep up with the rising cost of living, it’s not enough to boost minimum wage workers’ purchasing power.
  • At $11.25 an hour, the minimum wage falls far behind productivity gains. Between 1965 and 2012, productivity increased by 125%. The real minimum wage increased by only 64% during that period and all of that growth happened before 1975.
  • $11.25 falls short of all living wage calculations across the province. The living wage calculates what it takes for a family of four to make ends meet locally. It’s only 61% of the living wage in Toronto, 70% in Waterloo Region, and 75% in Hamilton.
  • $11.25 an hour keeps a full-time, full-year worker living in poverty.

“It doesn’t have to be this way,” says Tiessen. “Seattle, Los Angeles, and San Francisco have all committed to increasing the minimum wage to $15 an hour. And New York State — the entire state — is considering the possibility. There is still time for this Ontario government to revisit its own minimum wage and set it against a meaningful benchmark.”

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For more information please contact: Trish Hennessy CCPA-Ontario: 416-525-4927 or [email protected].