The province’s proposed minimum wage hike to $15 an hour in 2019 will result in a loss of approximately 50,000 jobs, says the province’s watchdog. This is certain to mostly affect working teens and young adults.
In a report assessing the economic impact of the wage increase, the Financial Accountability Office of Ontario (FAO) warns job losses should be expected as businesses facing higher payroll costs may respond by laying off workers.
Ontario’s minimum wage would increase by 32 per cent over 18 months compared with increases of 20 per cent over two years in 1990 or 28 per cent over three years in 2008.
The FAO report further states the wage boost would impact the broader economy by increasing prices and raising household spending.
Meanwhile, just one-quarter of the higher labour income would directly benefit low-income families.
Unfortunately, the very families the government hopes to help by increasing the minimum wage could end up in an even worse economic situation as their jobs could well be eliminated. As it is so many low-skilled jobs are being automated and companies in cost-cutting mode will find it more effective to invest in a one-time expenditure on technology rather than keep paying a human to do the same thing. The only thing that can deter business owners from going all out in replacing humans in the workplace is for the government to impose a tax on robots and all technology that has recently been replacing humans should be taxed heavily. If there is less of an economic incentive then jobs will be saved, otherwise it will become virtually impossible to certain low-skilled workers and young students to find survival jobs. – CINEWS