Alberta will be raising its minimum wage, from $8.40 to $8.80 per hour effective April 1, 2009. This puts Alberta slightly above the mid-range mark but not by much, and Alberta will fall lower after at least four other provinces implement their planned increases.
This rate is a lot better than the wage during the Klein years. Back then the argument was that you could not raise the min without killing jobs and the economy. This argument was repeated ad nausea everywhere and was generally accepted.
The media in Calgary at least, tends to dwell on the cost of the increase to business without giving much attention to the social factors such as the high cost of living. I honestly don't know how someone would live in Calgary on $8.40 or $8.80 per hour.
I wanted to provide an example of what this increase might mean to a typical small business.
An employer with 10 full time employees at $8.40 per hour, all at minimum wage, will pay 375 hours per week. (37.5 hours per employee.) They will pay a gross payroll of $3,150. If you factor 1.5 for employees contributions to EI and CPP the payroll becomes $4,725.
The same payroll at $8.80 costs $4,950, a difference of $225. So for this company the additional payroll will cost them $1,000 more per month.
To the employee this will mean a wage increase of $60 per month, or about $45 after withholding taxes. It might not mean much to many of us, but if you're in this wage bracket it might mean being able to keep your apartment or not.
Every business is different. Some won't be able to cover the difference and will cut back hours or layoff. Others will cut in other areas. Keep in mind that wages are a business expense that reduces the amount of corporate taxes that are paid. So its hard to say what the final cost really is.
Ain't life wonderful in the big city.
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