No surprise to those of us trapped in low-wage jobs, but for others more fortunate, let’s make it official: having a job is no longer a way out of poverty. The minimum wage in most provinces is so low that even someone working full time at a minimum-wage job falls far short of the poverty line. Indeed, it’s a fact that half of the families in Canada who are living below the poverty line have someone working 35 or more hours per week.
Low Wages: A Deliberate (But Reversible) Policy
Low minimum wages are one of the legacies of the free-trade and anti-inflation economic policies of the 1980s and ’90s. In an effort to reduce inflation and make Canadian manufacturers more competitive, governments deliberately pursued policies aimed at achieving “greater labour-market flexibility.”
In order to do this, interest rates were raised, slowing down the economy and thereby increasing unemployment. At the same time, employment insurance was made more difficult to access, and deep cuts were made to social assistance. Then the federal government stopped setting its own minimum wage, and provincial governments stopped adjusting minimum wages to keep up with inflation. The result was the creation of a low-wage economy.
It is worth noting that Canada actually has a highly educated workforce capable of supporting a high-productivity, knowledge-based economic strategy. Canada could have chosen a similar strategy to that adopted by many European and Asian countries. This alternative strategy would have delivered higher standards of living for everyone. Canadians have suffered for too long as a result of this deliberately retrograde choice.
At long last, however, there is a growing and well-organized movement emerging to challenge Canada’s political and business leaders. Coalitions are springing up in almost every Canadian province in order to call for raising the minimum wage. This pressure being put on political parties and provincial governments has resulted in some breakthroughs, although for the time being total success remains elusive.
Raising the Minimum Wage Across Provincial Divides
One of the first campaigns to emerge with a focus on raising the minimum wage was the “Ontario Needs a Raise” campaign, organized just before the Ontario provincial election in 2003. Following upon the successful campaign to “Feed the Kids and Pay the Rent,” several groups including the Ontario Coalition for Social Justice and the Centre for Social Justice began planning for a pre-election campaign. When groups discovered there were several initiatives in the planning stages, they came together to work out a common campaign. The campaign resolved to call for both a raise in the minimum wage to $10 an hour and an increase in social-assistance rates.
The Ontario-based campaign organized media events and leafleted at shopping malls and in front of subway stations. Political parties were lobbied to include raising the minimum wage in their party platforms. This met with some success, with the NDP being more forthcoming. The Ontario Liberals made a commitment to raise the minimum wage to $8 per hour over three years, while the NDP openly adopted a $10-per-hour minimum wage in their election platform. Once elected, the Liberals did begin raising minimum wages. However, they only raised social-assistance rates by three per cent. This did little to undo the damage done by the 21-per-cent cut administered by the previous Tory government. Perhaps not surprisingly, activists are renewing the “Ontario Needs a Raise” campaign with plans for a “Walk, Wheel, Ride for Dignity” action that will culminate in a large rally at Queen’s Park on September 29. This action is being initiated by the Peterborough Coalition for Social Justice in cooperation with the Ontario Coalition for Social Justice and the Ontario Disability Support Group.
In Manitoba, the Just Incomes Coalition, a coalition of 24 community, faith, labour, Aboriginal and women’s groups came together in 2003. The coalition created a website, put out a number of news releases and gathered names on a petition. But it has not been able to get Gary Doer’s provincial government to raise the minimum wage by very much. For this reason, in October, 2003, they organized a Just Incomes Week. Twelve events took place, including speakers, street theatre, a concert, workshops and other activities. It got a lot of media attention, and a lot more names on the petition. The organizers staged a rally and presented the provincial government with a petition of more than 8,000 names.
In response, the NDP government committed itself to a series of increases amounting to 25 cents per hour, annually. This resulted in a $7.25 minimum wage by April, 2005. However, this is not a living wage. The coalition met with the NDP Caucus and the labour minister seeking a $10-per-hour minimum wage by January, 2007, thereupon to be indexed to inflation. Repeatedly rebuffed by the Doer government, the coalition has decided to launch a community inquiry on low wages this spring.
New Brunswick has the dubious distinction of enforcing the lowest rates for social assistance, as well as offering the third-lowest minimum wage in the country. The Common Front for Social Justice – a coalition of labour, church, women, student and anti-poverty groups – has been campaigning to improve the province’s reputation on this score. Formed with strong participation by both anglophone and francophone groups, it has collected signatures for a Social Solidarity Contract that would increase the rates of income assistance and raise the minimum wage to the Low Income Cut-Offs poverty line. In December, 2004, a petition was delivered to the provincial government to this effect.
In Quebec, the Collective for a Poverty-Free Québec has adopted raising the minimum wage as one of four action objectives for the next two years. Efforts to get a campaign going to raise the minimum wage have been put on hold, however, as activists have had to deal with regressive welfare policies and cuts to social programs introduced by the Charest Liberals. Prince Edward Island has also had a coalition fighting for a raise in the minimum wage. The PEI Working Group for a Liveable Income formed in 2004, with 14 groups involved from labour, women, anti-poverty and faith sectors. They have met with a number of policy makers and managed to get a meeting with the governing Conservative Party Caucus in October, 2004.
Also in 2004, the Canadian Federation of Students, the Saskatchewan Federation of Labour and the Regina Anti-Poverty Ministry together formed the Living Wage coalition and adopted the slogan, “Make the Minimum Wage a Living Wage!” The Saskatchewan government has a Minimum Wage Board, which makes recommendations to the government on what minimum-wage rate ought to be. In 2001, the Board recommended a much higher increase than the government actually legislated. This time around, the Living Wage campaign is trying to organize public pressure to ensure a better result. They have distributed pamphlets, put up a website and got over 300 letters to the Minimum Wage Board. The Board has also taken oral submissions. A rally is planned in Regina in October, 2004.
The Dubious Distinction of Being Albertan
It probably comes as no surprise to find out that, at $5.90 an hour, Alberta has the lowest minimum wage of all the provinces. Several initiatives have been underway to challenge this. In Calgary, the Vibrant Communities project has brought together representatives from the Calgary Labour Council and the Calgary Chamber of Commerce, as well as churches, social-service agencies and anti-poverty groups, to advocate for a Living Wage. The focus has not been on raising the provincially legislated minimum wage, but in getting living-wage procurement and contracting policies enacted by City Council, and efforts at educating and engaging the business community to voluntarily raise wages to a living wage. Several groups in Edmonton have also initiated a Living Wage campaign and have made representation to Edmonton City Council.
During the Alberta provincial election in fall, 2004, Public Interest Alberta sparked debate about a number of social-justice issues, including the low level of Alberta’s minimum wage. Public Interest Alberta managed to get media coverage, with local activists using fact sheets to raise questions at candidates’ meetings to try to make poverty an election issue. Their efforts got an unexpected boost from Premier Ralph Klien when he made some offensive comments about disabled people on social assistance during a campaign stop. The mean-spirited neoliberal policies of the Alberta government became a major issue, with public opinion shifting against a government obviously awash in cash and yet so reluctant to do anything about Alberta’s growing crisis in poverty and homelessness.
Though Klein was re-elected, popular support for the Conservatives has dropped significantly. In an effort to respond to the criticism, Premier Klein recently announced an increase both in social-assistance rates for the disabled and in the minimum wage, which will now be set at $7 per hour. A coalition of groups led by Public Interest Alberta is trying to seize the moment to force the government to commit to further increases that will boost the minimum wage above the poverty line, of which it still falls short.
A New National Initiative: “Make the Minimum Wage a Living Wage”
At the national level, a coalition of labour, women’s, immigrant and visible minority, student, faith and anti-poverty groups has been pulled together by the National Anti-Poverty Organization (NAPO). Their goal is to develop a campaign to “Make the Minimum Wage a Living Wage.” These are their current objectives:
Reinstate a federal minimum wage, setting it initially at $10 an hour, with annual adjustments upward for inflation.
Raise provincial and territorial government minimum wages to $10 per hour, with annual adjustments upward for inflation.
Pressure employers to pay at least $10 per hour and support calls for raising the minimum wage to $10 per hour.
Urge municipal governments and universities to adopt living-wage policies that require procurement and service contractors to pay at least $10 per hour.
Plans call for getting endorsements from organizations and individuals, organizing a series of education and organizing workshops, launching a media campaign, and organizing for public input to the federal review of labour standards legislation.
Arguing for Ten Bucks per Hour – Minimum
By keeping the minimum wage unusually low, governments are creating poverty. Employers who pay wages below $10 per hour are contributing to poverty. Raising the minimum wage to $10 per hour will not cost federal, provincial and territorial governments anything. Most jobs paying below $10 per hour are in the service sector. They are therefore not affected significantly by trade competition. Experience in other countries has shown only a minor impact on employment. Any jobs lost are more than offset by new jobs created as a result of the increased purchasing power of low-wage workers who are typically spend their earnings in their local communities. Raising the minimum wage now would not likely have a significant inflationary effect as inflation rates are low, while the policy initiative would work to lower the poverty rate significantly.Dennis Howlett is executive director of the National Anti-Poverty Organization. Prior to assuming this position in February, 2004, he was team leader of the Canadian Justice program of KAIROS – Canadian Ecumenical Justice Initiatives, where he was responsible for programming on health care, refugees, poverty, ecological justice and Aboriginal rights.
From 1993 to 2001, Dennis was national coordinator of TEN DAYS for Global Justice, an ecumenical development education program.
This article appeared in the March/April 2005 issue of Canadian Dimension .