More than 120,000 B.C. workers get a raise today as the B.C. government hikes the minimum wage from $10.45 to $10.85 per hour.
An increase of just 10 cents had been scheduled under the BC Liberal government's previous plan of following a cost-of-living formula.
But Premier Christy Clark announced in May the increase would be boosted to 40 cents and indicated a similar lift will come next fall.
BC NDP leader John Horgan has committed to a $15 minimum wage, which is also the target of a campaign led by the B.C. Federation of Labour and is expected to be a key issue for New Democrats in next spring's provincial election.
The labour federation says the latest 40-cent increase does little to reduce inequality in B.C., while a $15 an hour minimum wage would help lift 500,000 B.C. workers – one in four – out of poverty.
“Small minimum wage increases— like the one we’re seeing today—only perpetuate working poverty," said Iglika Ivanova, senior economist at the Canadian Centre for Policy Alternatives.
“The majority of low-wage workers work full time, and nearly a third have been in the same job for over three years. We’re not talking about teenagers or casual workers—these are adults struggling to make ends meet with poverty-level wages in one of the most expensive provinces in Canada.”
B.C. previously had the lowest minimum wage in Canada, but the latest increase places it eighth lowest relative to other provinces and territories.
But critics of significant minimum wage hikes point to the strain it could put on businesses and suggest it could hurt as many people as it helps.
The Canadian Federation of Independent Business warned minimum wage increases can prompt businesses to cut jobs or hours, raise prices or delay expansion plans.
“The knee-jerk impulse to force employers to pay higher wages for entry-level jobs may make the politicians feel like they are doing something, but it may actually do more harm than good.,” said CFIB B.C. vice-president Richard Truscott. “When you add that to a potential CPP payroll tax increase, it’s easy to see why many small businesses are seriously worried.”
The B.C. formula discounts the minimum wage by $1.25 for restaurant and pub servers, to reflect the income they receive from tips.
Meanwhile, the province is also shelving planned hikes to Medical Services Plan premiums, which were to jump four per cent next year. Rates for MSP will stay at $75 per month for an adult earning more than $30,000 a year, and will go down for people on premium assistance.