By Dale Kirby
In August, the Dunderdale government quietly announced a review of the minimum wage.
Unlike the last minimum wage review, no public consultations will be held this time around. The deadline for public feedback is Sept. 15.
The minimum wage in Newfoundland and Labrador has been $10 per hour since June 2010.
It is worth noting that our province has the highest proportion of minimum wage earners in Canada.
Over two-thirds of those working for minimum wage in Newfoundland and Labrador are women.
A large proportion of minimum wage positions are concentrated in the service and hospitality sectors.
Harm to business
It is increasingly accepted that, despite suggestions to the contrary, there is no reason to believe raising the minimum wage will harm businesses or limit job creation.
In fact, over 650 economists, including five Nobel Prize winners, issued a statement in 2006 indicating that minimum wage increases significantly improve the lives of low-income workers without the adverse effects claimed by minimum wage critics.
Regular increases in the minimum wage benefit our economy as a whole because of the overall increase in purchasing power that results.
For example, low-wage workers tend to spend their new earnings on basic needs and services purchased from local businesses.
The Newfoundland and Labrador New Democratic Party does recognize that many smaller businesses such as family-run retail shops, local restaurants and neighbourhood grocery stores are increasingly being squeezed by the practices of big-box outlets and mainland retail chains.
This is why we continue to call for a reduction in the provincial small business tax.
It is important for the minimum wage to keep up with our increasing costs of living.
The cost of food, electricity, transportation, and other expenses are going up year after year. Increases in the cost of housing are causing difficulty in particular.
Lower-income renters are experiencing more problems in finding affordable housing, while the dream of homeownership is increasingly out of reach for lower wage earners.
Regular increases in the minimum wage will also help ensure that minimum wage earners are making an income that is above the poverty line.
At present, many minimum wage earners in Newfoundland and Labrador earn incomes that are below or only slightly above the poverty level.
Failure to increase the minimum wage will come at a cost to the province in the long term because low wages result in additional costs for taxpayers.
For example, low wage workers and their families have incomes that force them to seek assistance from government services and programs like subsidized housing and income support.
For these reasons, the New Democratic Party is asking the Dunderdale government to increase the minimum wage to a level that will help our lowest wage earners with their increased living costs.
We also believe that the province should establish a plan for indexing regular increases in the minimum wage.
Planned incremental increases would lend greater predictability and transparency to the process for wage earners and businesses alike.
Dale Kirby is the NDP MHA for St. John’s North.