‘People deserve a living wage’: Minimum wage increase not enough for decent quality of life, critics say

Audio report via CHMA 106. 9 FM:

New Brunswick’s minimum wage went up by one dollar on Friday, to reach $12.75 per hour. And another increase is slated for October, when the minimum wage will reach $13.75.

In a video posted to social media this week, Minister of Labour Trevor Holder acknowledged that “many New Brunswick families are struggling to keep up with the cost of living, and it’s getting worse.”

Reminder! On April 1st minimum wage will go up to $12.75, and in October, it will rise to $13.75.

This is the most significant increase in over 40 years and will give New Brunswick the top minimum wage in Atlantic Canada. https://t.co/FzEmJXFpZT pic.twitter.com/rI1FdIfSx7

— Government of NB (@Gov_NB) March 30, 2022

Until Friday, New Brunswick had the lowest minimum wage of any province or territory in Canada. Saskatchewan now holds that dubious distinction.

By October, New Brunswick is slated to have the highest minimum wage in the Atlantic region, against $13.70 per hour in P.E.I., $13.35 in Nova Scotia and $13.20 in Newfoundland and Labrador, according to the Retail Council of Canada.

It’s a far cry from last year’s widely-ridiculed five cent increase, based on changes to the Consumer Price Index.

At the time, Minister Holder said in a statement the policy would protect the “purchasing power of employees” while ensuring “predictability for businesses.”

But this year’s heftier raise still falls short of what anti-poverty activist call a living wage.

That amount would be close to $20 per hour in New Brunswick cities, according to calculations by the Saint John-based Human Development Council.

A living wage measures “the amount a household would have to earn to cover basic needs and live with dignity while enjoying a decent quality of life,” according to that group’s definition.

For reference: The Human Development Council’s most recent report on a living wage in New Brunswick cities. https://t.co/koAyTKaS3Z via @SaintJohnHDC pic.twitter.com/sPe7F1xKLz

— David Gordon Koch (@davidgordonkoch) April 2, 2022

Louis-Philippe Gauthier, senior director of Legislative Affairs Atlantic for the Canadian Federation of Independent Businesses, called the minimum wage a “blunt instrument” for poverty reduction.

The CFIB has argued many minimum wage earners are teenagers who live with their parents and don’t rely on their wages to survive.

But data from the Government of New Brunswick indicates 64 per cent of the roughly 45,000 people affected by this year’s increases are more than 19 years old.

And more than half of those affected are women.

We’re raising New Brunswick’s minimum wage by $2 per hour in 2022. On April 1st minimum wage will go up to $12.75, and in October, it will rise to $13.75. This is the most significant increase in over 40 years and is in line with our Atlantic neighbours. https://t.co/FzEmJXFpZT pic.twitter.com/zAkLwUYFQN

— Government of NB (@Gov_NB) December 2, 2021

One local entrepreneur – Madison Bragg, owner of Sackville-based Bragg’s Cleaning – said she won’t be affected by the change because her employees start at $15 per hour, and she believes it’s unacceptable to pay any less.

“I feel empathy for the businesses that will be affected,” she said. “I do think there are solutions out there because I seem to be able to do it.”

Meanwhile, Abram Lutes, provincial coordinator for the New Brunswick Common Front for Social Justice said higher wages will ultimately result in more sales at small businesses, because people will have more money to spend.

Instead, many people find themselves in “desperate conditions,” he said. “You have entities like payday lenders and things like that, that prey on the fact that people are short on cash, which in the long run only perpetuates the cycle of poverty.”

A version of this story was originally published on April 1, 2022 on chmafm.com. David Gordon Koch is the manager and a reporter with the NB Media Co-op.