With files from Simon Little
It’s official, B.C. is raising the minimum wage to $10.85.
That’s a 40 cent jump from the current rate of $10.45.
The minimum wage for liquor servers will also increase to $9.60, with the differential of $1.25 between the general minimum wage and the liquor-service minimum wage staying the same.
The province had hinted earlier this year that it would boost the minimum wage by a “modest incremental adjustment” above the rate of inflation because of a healthy economy.
The change will go into effect on September 15th this year.
Premier Christy Clark had previously tied the minimum wage to the Consumer Price Index, but says strong econmic growth in the province changed their plans.
“We’re leading Canada, we’re number one in economic growth, we’re targeted to grow at twice the national average, we’ve had four consecutive balanced budgets, British Columbia created 72,000 jobs in the last year.”
Clark adds the hikes mean an extra $1,400 in your pocket if you have a full-time job which pays the minimum wage.
Clark says B.C. will no longer be in the basement when it comes to minimum wages across Canada.
“This year, it’ll be a 40 cent increase effective September 15th, and then a further increase next year of up to about 40 cents as well. A base of 30 cents, plus the Consumer Price Index, which would put us at about third in the minimum wage across the country.”
Clark cited strong economic growth, balanced budgets, and high job creation as reasons for the increase.
The Premier adds she understands there will be concerns from small businesses and their ability to withstand the increases.
She says as a result, the province will be lowering the small business tax rate from 2.5 per cent to 1.5 per cent.
Last year, the B.C. raised its minimum from $10.25.
Mixed reaction to the increase
President of the B.C. Federation of Labour Irene Lanzinger says today’s announcement falls far short of the fifteen dollar an hour they’ve been lobbying for for years.
While opponents of raising the minimum wage often say it just raises the unemployment rate, Lanzinger says that’s never been borne out of any economic analysis.
“Because companies and businesses don’t employ people they don’t need.”
“They can’t just lay a bunch of people off; who does the work, who produces the product, who provides the service.”
Lanzinger says if you work full time, you shouldn’t live in poverty.
Ian Black with the Greater Vancouver Board of Trade says the impact to small business will be minimal.
“Half the people making minimum wage live at home, and of those, half of them are students. So there’s a very, very small number of minimum wage earners who are actually in the position of trying to support a family.”
But Richard Truscott with the Canadian Federation of Independent Business says small business owners didn’t sign up for this kind of an increase.
“They were expecting a small, modest, predictable increase, and now there’s something much more than that.”
Truscott says there will be business casualties as a result of this decision.
At the other end of the spectrum, Ian Tostenson with the BC Restaurants Association says the promised incentives for small business will soften the blow.
“They’ve put some incentives along training and hiring and also some business tax rate decreases that will try to offset this for the employers.”
Both admit, however, a drastic jump to $15 an hour like many have lobbied for would have been devastating to businesses.