On October 1st, Newfoundland and Labrador became the province with the second lowest minimum wage in the country. In a province that has over 13,000 minimum wage workers (the majority of which are women), we need to commit to doing better for minimum wage workers and work towards a $15 minimum wage now.
A minimum wage worker in our province working a 40-hour week earns $23,712 annually, which guarantees them remaining as part of the working poor. Our government’s answer to addressing a low minimum wage is to increase the wage based on the previous annual rate of inflation for Canada. Based on last year’s rate of inflation, that would increase the wage to around $11.65, an increase of $10 a week. A recent report by the Canadian Centre for Policy Alternatives (CCPA) found that a minimum wage worker in St. John’s would need to work 55 hours a week, every week, just to afford the rent for a one-bedroom apartment.
The most recent and credible academic research shows that an economy built on low wage employment is characterized by escalating poverty, rising inequality and slower economic growth. Newfoundland and Labrador is proof of that. We already have an unemployment rate that is more than double the Canadian average and rising. We have almost a full one-third (70,000 workers) of our labour force earn less than $15 an hour.
In our own country, the most recent experience shows that the benefits that come with a higher minimum wage are significant. The actual experience in those provinces with the highest minimum wages is one of moving people out of poverty, of job creation in low wage sectors, of more money being spent in local economies and in local businesses, and economic growth.
Newfoundland and Labrador has seen the number of workers earning minimum wage grow over the past few years, with an increase of 8% from 2016 (12,400) to 2018 (13,200). This is a troublesome trend, not only are we on track for the lowest minimum wage in the country, but the number of minimum wage earners is growing.
The provincial government recently announced a review of the minimum wage in our province, which is mandated by legislation. The Newfoundland & Labrador Federation of Labour looks forward to this review, and an open discussion on how we can get to a $15 minimum wage.
Wage and gender inequality, poverty and precarious employment are very real issues in Newfoundland and Labrador that people deal with every day, and they are on the rise. A $15 minimum wage will not solve these issues alone, but it will go a long way in moving workers and families out of poverty, reducing inequality, and putting more money into the pockets of workers that will be spent in the local economy. The time is now.
President, Newfoundland & Labrador Federation of Labour