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Alberta’s minimum wage gets a raise

The change moves Alberta closer to the rest of the country on pay

Aug 6, 2014

by Michael Ganley

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Just 1.5 per cent of Albertan employees earn minimum wage (25,700 people), far below the national average of 6.8 per cent
Photograph CP Images

On September 1, Alberta’s minimum wage rises to $10.20 per hour, up from $9.95. The change moves Alberta closer to the rest of the country on pay, where minimum hourly wages range from $10 in New Brunswick to $11 in Ontario.

Any adjustment of the minimum wage brings ­debate about upward pressure the increase may have on all wages, increased payroll taxes, inflation and, ultimately, the potential loss of jobs. Anti-poverty activists and labour unions tend to favour increases, while small business owners are generally opposed, arguing that they must absorb the added costs through reduced hours, reduced training or job cuts. Soon after Ontario raised its minimum wage to $11 in June, for example, a Tim Hortons franchisee switched breaks offered for hourly workers from paid to unpaid. Hardly a step up for employees.

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Finding the most beneficial minimum wage is a mix of art and science, and depends on data specific to the jurisdiction: employment rates, ­economic strength and number of people earning the minimum wage, to name a few. The International Monetary Fund recently urged the U.S. to raise the federal minimum wage, currently at US $7.25, saying “It would be helpful from a macroeconomic point of view” because a raise would help boost the income of millions of working poor. Seattle, for example, is gradually raising its minimum wage to US$15 per hour from US$9.32.

Of course the take-home income for a minimum-wage earner depends on taxes. When you consider that Alberta has a low personal income tax rate, and no sales tax, Albertan minimum-wage earners wind up with the best take-home pay of their kind in the country.

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