Why Canada needs a federal minimum wage
The benefits of paying people decent wages are abundantly clear. A generation ago one full-time minimum wage job was enough to keep someone above the low income line in a large urban area. This has not been the case for some time.
Research from the University of British Columbia (Forin and Lemieux, 2014) shows that increases in the minimum wage between 2005 and 2012 have made a significant difference for low wage workers. Economist David Green (2015) writes that minimum wages can be effective in reducing poverty and inequality if they are raised high enough to lift workers above the poverty line.
There used to be a minimum wage for federally regulated industries, but it was eliminated by Jean Chretien’s Liberal government in 1996. Since then, employers have paid the prevailing minimum wage in the province they are working in.
While very few workers in the federal jurisdiction earn less than $10 per hour, many more earn somewhere between $10 and $15 per hour. Establishing a $15 minimum wage in the federal jurisdiction would directly benefit approximately 100,000 workers in industries such as telecommunications, air and road transportation, and banking.
A federal minimum wage also establishes national leadership on a fair minimum wage, and fair mechanisms for updating minimum wages. Unfortunately, in many provinces, minimum wages are set using vague, inconsistent and unaccountable mechanisms. They are left to stagnate for too long, pushing people and families into poverty before pressure builds and governments are forced to take action. A federal standard for minimum wages would help change that.
If we can reduce inequality and make things a little bit fairer for workers, shouldn’t we make that a priority?