Minimum wage hike could spell spike in child care fees

Tough situation!

Tough situation!

One of the unintended consequences of raising the minimum wage eventually to $15 by the end of 2018 could be that daycare cost for parents will rise to accommodate the new economic reality.

How on earth can the Ontario Liberals hope to keep their pledge to make child care more affordable is something is a multi-million dollar question.

Indira Naidoo-Harris, Ontario’s minister responsible for early learning and child care, says the province’s recent Changing Workplaces Review, which recommends an increase to the minimum wage, 10 paid sick days and a three-week paid vacation, is “good for child care workers, good for children and good for families.”

“The ministry is considering the impact of the increased minimum wage as part of our continued work,” she said in a statement.

With provincial elections around the corner it would seem that nothing is off the table and don’t be surprised the government announces some sort of subsidies for families stuck with mounting daycare costs.

Meanwhile with minimum wage rising or set to rise in different provinces, there is a debate raging about its impact on the economy and jobs.

Economics 101 will tell you that when the cost of labour goes up, jobs will be lost. But it’s not so black and white.

In Alberta 300,000 workers currently make less than $15 an hour. The province has been struggling for a while now economically with the crash in oil prices.

The Canadian Federation of Independent Business (CFIB) calls the minimum wage increase an “ill-advised climb,” and predicts it will cost the province as many as 50,000 jobs.

Job loss is the worst-case scenario, and minimum wage hikes can impact hiring decisions, according to Craig Alexander, senior vice-president and chief economist with the Conference Board of Canada.

Meanwhile 53 economic experts across the country claim the move “makes good economic sense” and could generate “substantial benefit to low-wage workers, their families and the economy as a whole.”

It is clear that many companies may have to re-consider their hiring decisions, outsource jobs or utilize technology more effectively. – CINEWS

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