This presentation discusses Ontario's planned minimum wage increase to $15/hour by January 2019. It is forecasted that the wage hike could lead to 50,000-185,000 job losses, with impacts concentrated among teens and young adults. Both supporters and critics of the increase cite studies and data to argue their perspectives on the economic effects. The presentation provides background on average wages, employment levels, GDP, energy costs, and profiles of typical minimum wage earners to outline issues around the policy change.

1. PAUL YOUNG, CPA, CGA
SEPTEMBER 13, 2017
Government Policy – Minimum
Wage – Ontario – September 2017

2.  This presentation is one look at Ontario minimum wage changes. Job losses being
forecasted are always dependent on assumptions. The job losses that may result in
minimum wage changes range from 50,000 to 185,000.
Description

3. Paul Young - Bio
• CPA, CGA
• Academia (PF1, FA4 and MS2)
• SME – Risk Management
• SME – Close, Consolidate and Reporting
• SME – Public Policy
• SME – Emerging Technology
• SME – Business Process Change
• SME – Financial Solutions
• SME – Supply Chain Management
Contact information:
Paul_Young_CGA@Hotmail.com

4.  Average Wages by Sector and minimum wage
 Employment – August Analysis
 Provincial GDP
 Energy Poverty
 Minimum Wage Breakdown
 Job losses
Agenda

5. Source - Stats Canada or
https://www.retailcouncil.org/quickfacts/minimum-wage
Average Wages vs Minimum Wage
• Alberta is moving to $15/hr – October 1, 2018
• Ontario is moving to $15/hr – January 1, 2019

6. Source – Stats Canada
Employment – August 2017
• An increase in the number of people
working part time (+110,000) was mostly
offset by a decline in the number of
people employed full time (-88,000).
While the increase in part-time
employment was spread across the age
groups, most of the decrease in full-time
employment occurred for youth
aged 15 to 24. The overall employment
decline for youth was accompanied by a
notable decrease in their labour force
participation.
• In the 12 months to August, employment
rose by 374,000 (+2.1%), with gains in
both full-time (+213,000 or +1.5%) and
part-time work (+161,000 or +4.6%).
Over this period, the number of hours
worked increased by 2.2%.

7. Source - http://www.rbc.com/economics/economic-reports/pdf/provincial-forecasts/provtbl.pdf or http://www.canadianmanufacturing.com/human-resources/ontario-minimum-
wage-hike-lead-50000-job-losses-provincial-watchdog-201125/ or http://rankandfile.ca/2017/08/15/ontario-chamber-of-commerce-peddles-more-myths-about-a-15-minimum-
wage/
Provincial Forecast
Labour Minister Kevin
Flynn said that because of
the province’s strong
economy the government
can move forward with the
minimum wage increase.
He pointed to studies
written in recent years by
the Organisation for
Economic Co-operation
and Development, the
Center for Economic and
Policy Research and the
Canadian Centre for
Policy Alternatives that
support the move.
• Ontario’s economy has been
driven by real estate and
automotive
• Ontario has been slow to
develop natural resources
like the Ring of Fire
• Energy costs have force
manufacturers to expand
operations outside of
Ontario
• Ontario businesses have
been hit with carbon tax in
2017
• Ontario businesses will be
impact by CPP tax increae

8. Source - http://www.canadianmanufacturing.com/human-resources/ontario-minimum-wage-hike-lead-50000-job-losses-
provincial-watchdog-201125/ or http://www.nugget.ca/2017/08/21/wynne-liberals-created-hydro-one-crisis
Energy Poverty / Ontario
“We don’t believe
that anyone in
Ontario who works
full time should be
struggling to pay
their rent, put food
on their tables or
care for their
families—especially
when the provincial
economy is doing so
well,” Flynn said in a
statement.
• There are households in Northern
Ontario are not equally treated
under the province’s failing energy
system. Still, Hydro One applied to
OEB (Ontario Energy Board) to
again raise Hydro One rates up to
2021.
• Since the Liberals took office,
Ontario households pay $1,000 per
year more for electricity which has
caused poverty, hardship, illness
and grief.
• This past winter Ontario rural
residents were forced to make life-
altering choices to pay for food,
rent, or put gas in their cars in
order to survive. Many have to sell
their homes!

9.  http://www.macleans.ca/economy/money-economy/minimum-wage-in-canada-by-the-numbers/
Truth on minimum wage
• New minimum wage will cost Metro $45M to
$50M
• 17,300 jobs could be lost in the restaurant
business
• Ontario's plan to increase the minimum wage
to $15 per hour, among other labour reform
proposals, will put at risk 1,270 jobs in Grey
County and 880 jobs in Bruce County over
the next two years, according to a study
commissioned by a business coalition
objecting to the changes. Those local figures
come from a preliminary report
commissioned by the Keep Ontario Working
Coalition, which includes the Ontario
Chamber of Commerce, Food and Beverage
Ontario, Ontario Federation of Agriculture,
and the Retail Council of Canada.

10. Source - http://www.canadianmanufacturing.com/human-resources/ontario-minimum-wage-hike-lead-50000-job-losses-provincial-watchdog-201125/ or
https://thetyee.ca/News/2017/08/18/Young-Workers-Left-Behind/ orhttps://www.youtube.com/watch?v=zQpUN3AK8eA
Job Loss Impact – Ontario Minimum Wage
More than 50,000 people could lose their jobs if the
Ontario government goes ahead with its plan to raise
the minimum wage to $15 an hour by 2019, the
province’s financial watchdog said Sept. 12.
The job losses would be concentrated among teens and
young adults, while the number of minimum wage
workers in Ontario would increase from just over
500,000 to 1.6 million in 2019, said a report released by
the province’s Financial Accountability Office.
FAO chief economist David West said Ontario is
entering “uncharted waters” with the increase because
no other jurisdiction has gone so far so quickly.
While the increase will have a positive impact on the
province’s total labour market income—hiking it by 1.3
per cent—it will also result in the job losses over a
number of years.
Over the last four months full-time
employment for the 15 to 25 demographic
increased by 2.1 per cent — about 26,000
full-time jobs, while increasing 2.0 per cent
for the over 55 group — about 58,000 jobs.
But between 2012 and 2016 the youth
demographic actually lost 20,000 full-time
jobs — a 1.6 per cent decline — while
those over 45 gained 228,000 full-time
positions, a 3.6 per cent increase.
Macdonald cautions against just using job
statistics to determine the health of labour
markets. But young workers are in a
unique position, he said.
“The only folks that are still left behind are
the youth under 25,” Macdonald said. “Nine
years now after the great recession we still
haven’t seen a full recovery for youth.”
Tyee – August 18, 2017
Canadian Manufacturing – September
12, 2017

11.  https://www.parrysound.com/opinion-story/7497870-50-canadian-economists-support-ontario-minimum-
wage-hike/ or http://www.torontosun.com/2017/07/13/cfib-shut-out-of-ontarios-minimum-wage-talks
Wynne’s team economist vs private sector economist
We, the undersigned economists, support the decision to increase the
minimum wage in Ontario to $15 an hour. Raising the wage floor
makes good economic sense.
Today, Ontario's minimum wage is $11.40 per hour. Adjusted for
inflation, this is barely one dollar higher than its value in 1977. Yet over
the same four decades, the average productivity of workers has
increased by 40 per cent. And the prevalence of minimum wage work
is spreading. Around one in 10 Ontario workers make minimum wage
today, with a large increase in this proportion over the last two
decades.
Low wages are bad for workers as individuals. An individual working
full-year, full-time on the minimum wage can still fall short of the
poverty line. The situation for minimum wage workers trying to support
families is no better — and evidence shows that this is increasingly
what is asked of minimum-wage workers. The stereotype of the
teenager living at home making minimum wage is out of date: over 60
per cent of workers earning minimum wage in Ontario in 2015 were
over the age of 20, as were over 80 per cent of those making $15 or
less.Academics and union supporters
The head of the country’s largest small business
association is shocked they have been shut out of
provincial talks on hiking Ontario’s minimum wage.
The Canadian Federation of Independent Business
learned Thursday the Liberals have excluded them from
province-wide committee discussions on raising the
minimum wage to $15.
“It’s a shocking and clear sign that the province is not
keen to hear anything other than what they want to
hear,” said Dan Kelly, president of the CFIB, which
fears such a raise could put many small companies out
of business.
The province wants to raise the $11.40 an hour
minimum wage to $14 on Jan. 1, 2018, and then up to
$15 the next year. There would also be equal pay for
part-time workers, increases to vacation time and
personal emergency leaves.
The province says increasing the minimum wage will
increase a worker’s purchasing power and boost the
economy. The provincial committee hearings on the
minimum wage are set to start Monday.

12.  Who make up minimum wage earners?
 We sought to answer this question in a recent Fraser Institute study, using data from Statistics Canada. The results may be
surprising for minimum wage advocates. Specifically, we found that:
 • 88 per cent of minimum-wage earners do not live in a low-income household, as measured by Statistics Canada’s low
income cut-off (LICO).
 • 83 per cent of workers living in a low-income household earn more than the minimum wage.
 In other words, most Canadians who earn the minimum wage are not “poor,” and most of those living in “poor”
households earn more than the minimum wage. For a government policy aimed at helping the working poor, the
minimum wage simply does not efficiently or effectively target the people it is supposed to help.
To help explain these results, we looked at some of the other characteristics of minimum-wage earners including their
age, education, and more. Here is what we found:
 • 58 per cent of minimum-wage earners are teenagers or young adults aged 15 to 24, with the vast majority of them (85
per cent) living with their parents or other relatives. For many youths, a minimum wage job is their first while in school
and often a stepping stone to higher paid employment.
 • 54 per cent of minimum-wage earners have achieved a high school diploma or less, signalling very low levels of
education. If we focus on all workers who hold a university degree, then only 3 per cent earn the minimum wage. This
should put to rest the idea that a substantial share of university graduates is working minimum wage jobs.
https://www.fraserinstitute.org/blogs/the-typical-minimum-wage-earner-in-canada-not-who-you-

13.  • 58 per cent of minimum-wage earners work part-time. More broadly, however, part-time workers are much
more likely than full-time workers to be earning minimum wage. Consider that just 4 per cent of all full-time
workers earn the minimum wage, challenging the notion that a large cadre of full-time career workers is
dependent on the minimum wage.
 • 20 per cent of minimum-wage earners have an employed spouse, meaning there is more than one earner in
the household. And the vast majority of their spouses earn more than the minimum wage.
 • Just 2 per cent of minimum-wage earners are single parents with a young child, diffusing the misperception
that minimum-wage earners are generally single parents struggling to survive.
 The facts paint a surprising picture of the typical minimum-wage earner in Canada: a young person, usually
living with parents or other relatives, while often in school and working a part-time job.
 If the goal is to help the working poor, raising the minimum wage is at best a very crude method since it
poorly targets those in need. At worse, can produce harmful economic consequences by reducing job
opportunities for low skilled workers.

https://www.fraserinstitute.org/blogs/the-typical-minimum-wage-earner-in-canada-not-who-you-

14.  We have skill gaps in Canada as such more emphasis should be on moving people to
careers where there are openings
 Minimum wage jobs were never meant to be lifetime careers
 Government policies have forced business to look elsewhere for their expansion
 Ontario suffers from high cost to live driven by housing and energy costs
 Companies when hit new costs will either shut down or reduce their operations.
 Wynne’s work included only people that work in academic or had ties to union. Wynne
did not listen to job creators.
Summary