Ontario's Fair Workplaces, Better Jobs Act plans to increase the minimum wage by 32% in only 18 months. Ontario risks labour reduction by increasing the minimum wage. Studies have shown that increasing the minimum wage has led to a reduction in employment especially for youth. The Premier’s own 2014 Minimum Wage Panel concluded that, in the Canadian context, researchers have generally found an adverse employment effect of raising minimum wages especially for young workers. In fact, Canadian studies have found that teen employment would drop by 3% - 6% if the minimum wage is raised by 10 percent.
Given that changes to the minimum wage were explicitly left outside of the terms of the Changing Workplaces Review, we cannot help but wonder if the recommendations would have been different if the advisors would have been permitted to consider an increase to the minimum wage as an alternative to these recommendations.
As employers, our members believe that increasing the minimum wage and fully implementing these recommendations would have the perverse effect of discouraging investment and eliminating jobs, thereby diminishing economic opportunities in Ontario. We are calling on the government to consider a slower pace for minimum wage implementation to allow businesses predictability and the ability to adjust. The government should look to other jurisdictions for guidance on reasonable timelines for implementation.