Whitehorse Daily Star

Constant minimum wage boosts create risk: chamber

Skyrocketing inflation could lead to a big jump for the Yukon’s minimum wage next year; it’s tied to the Consumer Price Index (CPI), and the Yukon Party says that could be a problem for businesses.

By Ethan Lycan-Lang on November 21, 2022

Skyrocketing inflation could lead to a big jump for the Yukon’s minimum wage next year; it’s tied to the Consumer Price Index (CPI), and the Yukon Party says that could be a problem for businesses.

Last week, the Yukon Party continued its attack on commitments made in an agreement between the Liberals and NDP.

The official Opposition asked if the minimum wage will continue to rise with inflation – which has increased substantially since last spring – when the NDP-Liberal agreement keeping the minority government in power expires next year.

Currently, the minimum wage is $15.70 an hour in the Yukon. As part of the Confidence and Supply Agreement (CASA) between the Liberals and the NDP, annual increases are now tied to the CPI. The wage increases every April 1 based off that figure.

Going off the CPI (7.5 per cent) for Whitehorse in September, the Yukon Party asked the government if businesses should prepare themselves for a potential $1.18 increase in the hourly wage next spring.

In question period last Monday, YP MLA Geraldine Van Bibber asked Community Services Minister Richard Mostyn when businesses will know what the increase will be next April.

 “Yukon businesses are looking for certainty as they try to navigate the economic challenges that are ahead,” Van Bibber said.

“A potentially massive increase to the minimum wage could have a serious impact on a lot of small and medium businesses.”

Mostyn said the minimum wage increase is based off the annual CPI report from the Yukon Bureau of Statistics, which comes out in February. He said tying the minimum wage to inflation is necessary.

“We are working very, very hard to make sure that this territory, in the face of all the inflation pressures we are seeing, is affordable for Yukoners,” he said.

“A minimum wage tied to inflation — as with other social supports — aims to help to reduce poverty and increase affordability for Yukon’s lowest wage earners.”

Mostyn told reporters last week the government was clear and transparent with businesses about minimum wage increases last year, informing them in late January what the CPI-based increase would be.

Mostyn asked if the government would reconsider the current model of raising the wage, given huge increases in the CPI – 7.6 per cent for Whitehorse in October – and a rapidly approaching expiration date for his party’s agreement with the Yukon NDP. The minister was non-committal.

“I’m going to say that we haven’t made a decision yet how we’re going to proceed with this – and we actually don’t even know what the rate is yet,” he told reporters. “I think everybody should take a deep breath and wait to see what happens in the early New Year.”

The CPI for Whitehorse published in February of this year was 3.3 per cent, compared to the national CPI of 3.4 per cent, Statistics Canada reported.

The CPI measures the price change for goods and services bought by consumers in Whitehorse.

It essentially shows how the average cost of a large basket of goods and services goes up on a monthly and annual basis. So as the price of gas, milk, eggs and many other goods climbs, so does the CPI.

The point of tying the minimum wage to the CPI is to ensure pay for the territory’s lowest-income households reflects the cost of goods and services in the territory, said NDP Leader Kate White.

“We’re talking about the lowest wage earners in the Yukon,” she told reporters last week.

“It should be tied to inflation…and we should also make sure that it doesn’t drive people into worst poverty.”

White said she doesn’t know of many Yukon businesses that don’t pay more than the minimum wage. She expects low-income employees will be helped far more than any businesses will be hurt.

Shayna Hammer, the executive director of the Yukon Chamber of Commerce, disagrees.

Hammer said the chamber includes more than 750 businesses, most of which are small or medium-sized enterprises.

Though she acknowledges many of them “are already offering competitive wages,” she said her members would still be concerned with a large jump in the minimum wage. 

“Further increases definitely invite the risk of rendering a lot of smaller businesses, especially in a post-COVID economy, unviable,” she said in an interview.

“Continued increases will have detrimental impact on small and medium enterprise in Yukon, pushing up all costs of living in a continuously increasing cycle,” she said.

“So if we’re looking at affordability, maybe that’s not quite the right choice at this point.”

Hammer said an increase could lead to layoffs, reduced hours and even a push to replace workers with automation wherever possible.

She also asked if tying minimum wage to the CPI would go both ways, wondering what would happen if the index went down.

She also questioned whether minimum wage hikes are even effective in increasing affordability.

She referenced a 2020 Yukon government evaluation of proposed changes to minimum wage that called the minimum wage a “crude anti-poverty measure” at best.

That report said one-third of an increased minimum wage is deducted. The remaining 70 per cent goes to students and teenagers who have financial support from their parents. 

“This leaves just 20 cents on the dollar for the poor,” the report states.

The findings from that report, however, are far more ambiguous than that, saying economists are divided on the economic impact of minimum wage increases.

“The lack of evidence cuts both ways,” it reads, “with little clear and convincing evidence that minimum wages harm labour market outcomes for low-wage workers, nor much evidence that they reduce poverty.”

The report notes the latest numbers available at the time showed 1,500 employees were earning less than $15 an hour in the territory, about seven per cent of the Yukon’s employees. All Yukoners are now required by law to earn more than that.

Hammer suggested there are other ways to improve affordability outside the minimum wage through tax breaks and social programs.

Yukon Party Leader Currie Dixon believes this is a more appropriate route.

He told reporters last week his party would prefer to increase affordability through a series of cost-saving measures for Yukoners such as cutting the fuel tax temporarily and enriching the home owners grants program.

He also said the government should return to re-evaluating the minimum wage through an independent committee, not by tying it to inflation.

“When you increase the minimum wage too dramatically, too quickly, what you’re going to do is put the pressure on small businesses to have to make decisions about either cutting jobs or reducing the amount of business that they do,” he told media.

“And we don’t think that’s a sustainable path either for Yukon businesses.”

Mostyn told the legislature last week the government is also tackling affordability through means beyond minimum wage. He touted the government’s work on universal childcare and subsidies for heating costs, both through fuel wood and electricity.

The current minimum wage model tied to the CPI will need to be re-evaluated once the CASA agreement expires Feb. 1, 2023.

Comments (28)

Up 0 Down 1

drum on Nov 27, 2022 at 4:20 pm

Most of the big box stores have brought in 80% self serve. They are putting long term employees on part time. I do not work there - I refuse to do self checkout and if they do not sujpply me with a cashier I will leave my cart and leave. They do not even pack your grocieries anymore. Where did customer service go - we have seen increasing costs of everything and large box stores have never seen such large profits - but we the customer do not even get our purcheses packed!!!!!!!

Up 0 Down 1

TheHammer on Nov 27, 2022 at 3:04 pm

'cutting jobs or reducing the amount of business'.. He forgot to mention jacking up prices to make even bigger profits.

Up 3 Down 0

Chuck Farley on Nov 26, 2022 at 4:04 pm

Needs change; don't kid yourself; teenagers are no longer working in the service industry; staff today are adults; back in the 80's high school students were working at CDN Tire; fast food outlets; gas stations - it's the TFW that has had a major impact on the job market / salaries

Up 7 Down 3

Max Mack on Nov 26, 2022 at 12:43 pm

The Yukon Party is the opposition. Challenging the reigning Lib/NDP alliance is what they are supposed to do.
The Yukon Party is also supposed to represent fiscally conservative values. This is what they are doing.

Good on them.

Up 2 Down 2

Bill's best friend on Nov 25, 2022 at 5:56 pm

Billy boy. Don't lie to the randoms, you don't have friends and honestly I'd personally be amazed if you even had loose acquaintances.

Up 4 Down 8

Nobody is working for the minimum wage anymore on Nov 25, 2022 at 12:55 pm

The percentage of employers in Whitehorse paying minimum wage is like less than 1/10 of 1 percent. The Yukon Party must really be running out of things to complain about. What should scare us is not the minimum wage increasing by a buck, it's these bozos one day forming the government.

Up 6 Down 4

Bill on Nov 25, 2022 at 12:29 pm

Jim you are wasting your time with this fool. He sees the world through rose coloured lenses with blinders on the sides - actually the rose is a deep red.

Save us all some time and just ignore him. My dad always said "don't engage a fool unless you want to be one too".

Up 8 Down 2

Adam Smith on Nov 24, 2022 at 10:20 pm

I think a lot of people are missing the point. We are losing people that are willing to work in minimum-wage jobs. Demographics. I humbly suggest that there are a lot of people in the NGO work that refuse to accept these facts.

Watch Unions become more powerful and relevant. How can the employer not give a 7% wage increase when inflation is 7%?

Up 9 Down 11

Totally real name on Nov 24, 2022 at 5:15 pm

Hey there Jim. It sounds like you are addicted to having jobs and adverse to a career. Some jobs are not for everyone but how would you know what is good for you or you're good at, without experiencing it? Not sure about you but I can't read minds or motivations. That would expedite the hiring process significantly but it's also not plausible.

Back to our minor disagreement... Simply put, if capitalism doesn't require a slave class, why do the capitalists not support a minimum wage?

I'm happy you brought up an unfortunate assumption that a dishwasher making 40k is a lot of money. My dude, that's literally 1 dollar above minimum wage full time. 1 entire dollar.

A 23 dollar hamburger? Again, my dude. Le sigh. That's about the average price for that item at your main street eateries. It's like 13 at McDonald's without salted fries and a soda. Have you been out much since the early 90s?

A better question than that dishwasher hypothetical might be, why is a business that's unable to pay its employees a living wage still running? If it's successful the people will be pounding the door down for the opportunity to work there.
If you can't pay for employees then be prepared for all the work. It's not a difficult concept. It usually comes down to profits over people aka greed.

I would simply remind folks reading this about that Holy Book that's in those motel drawers. There is a passage I'd recommend about being wealthy with the expectation of entry to the Kingdom of Heaven. I don't want to ruin the fun, but it's worth reading. Matthew 19:24. Buckle up!

Up 9 Down 7

Jim on Nov 24, 2022 at 4:21 pm

@totally real name, no, capitalism does not require slave class workers. But let’s be serious, paying someone minimum wage is normally for people who are new and untrained. You reach a point where automation becomes more effective, reliable and profitable over hiring a “green” employee. That’s why you are seeing more self checkouts in stores and fast food restaurants. I guess in your perfect world it would be wonderful for your student dishwasher or bus boy to be paid $40k a year ( or whatever you believe is a living wage) and be able to own a home and drive a car. But your most likely the same person who will complain when your quarter pounder is $23. Jobs are worth in pay what in turn they can produce in profitable sales.
Sometimes employees work for several months or years before they become financially productive for the company. And who knows if they will stay once they are or see a YG job opening and move on. In the meantime a business has invested their time and cost in training and may never see one thin dime of return on their investment. In all the years I have worked at many jobs, it was always dependent on one’s enthusiasm and capability to do the job. On the flip side I had jobs that I didn’t fit into and pointed the door.

Up 10 Down 4

Totally real name on Nov 24, 2022 at 9:16 am

Ug. The admiral/boot licker wanting others to do the work for them. Ironically telling others to learn about the system while ignoring other countries and their systems. Priceless. A classic right wing extremists with zero capital defining a system that does not benefit anyone.

Instead of begging others for their ideas, perhaps read some literature and educate yourself?
It is not the job of others to make up for your lack of education or your faux ignorance of the world.
If you have never heard of other countries or their systems of government, that's on you Hoss.
You keep asking for better systems, how about a glance at those Nordic countries. Maybe look into France and Portugal.
Again. Take these starting blocks and continue learning. Or don't and be mad all the time because life is harder and more confusing because of your own actions.

How much capital do you have Mr. Capitalist? None? I'm shocked. Just shocked.

Up 18 Down 4

Snowman on Nov 23, 2022 at 3:21 pm

@Groucho you are absolutely right about the pay that politicians receive. Just imagine how much the politicians who have been there the longest are making! People like Brad Cathers, Scott Kent and to a lesser degree Currie Dixon are making bucketloads of money for the reason you stated. They have made a career out of being a politician. I think they should do like Silver and exit the stage or at least agree to a pay freeze. Brad Cathers should also stop bilking taxpayers for his drive back and forth to work everyday!

Up 15 Down 15

Juniper Jackson on Nov 22, 2022 at 9:48 pm

There are people who genuinely need a helping hand..That, to my mind, is what welfare if for. This group, tends not to be on welfare their entire lives, and their kids on welfare after that. I have no use for Welfare bums. I have worked 3 jobs with 6 or less hours of sleep a day, but never collected welfare. Today..it's 2022.. the most advanced time in the history of mankind. People shouldn't have to work 3 jobs. We know more about taking care of ourselves, our families. The problems are so multifold, that there isn't any one solution for today. The employee doesn't have enough money? Or the cost of purchasing necessities is so high it eliminates all disposable income just to survive with rent and groceries? How much can I blame on the Trudeau Liberals? Quite a lot.. as they shut down business after business, send billions out of the country, instead of investing in Canada, make it harder and harder to get to a job, clothes, gas, child care.. where does it stop? it doesn't.. not right now anyway. The Liberals and the NDP have to go. When something is free, a person has no investment in it, it has no value..just put that paw out for more.. destroy it and just go get another..but, if you have worked for it, paid for it..whatever it is..it's yours..and God help anyone who tries to take it away from you.. Just read the comments from someone who worked and saved for years to buy a skidoo and someone steals it.

Up 9 Down 11

AdmiralA$$ on Nov 22, 2022 at 7:56 pm

Still waiting for your replacement Mr. Name boy. Hopefully the ghost of capitalist past doesn't haunt you too terribly badly.

Better yet, get skill, work hard and gain capital. Save capital and return into capital investment. Don't complain about the system, just learn it.

Up 30 Down 0

Groucho d'North on Nov 22, 2022 at 3:26 pm

The politcians get an annual pay increase based on inflation. Keep in mind these are the most well paid people in the nation, yet they looked out for themselves by entrenching a bump in their paycheques every April 1st.

Up 15 Down 3

Jayne W on Nov 22, 2022 at 10:33 am

@TMYK do your research. For retail FTW for example the wage per hour is 17.00 you can't pay them any less than that. FTW none of the jobs are min wage.

Up 24 Down 8

SH on Nov 22, 2022 at 10:16 am

Mr. Facts,

Try getting a job and contributing to society when you're left caring for an infant after your partner leaves, or when you have significant and debilitating health issues, with no supports. There are many people who are on social assistance due to situations beyond their control, and who would much rather not be on social assistance. Being on social assistance isn't easy or fun. You barely get enough to live on.

Life can happen to any of us, including you. You or a family member - under the right circumstances - could become a "welfare bum".

Up 26 Down 10

yukong on Nov 22, 2022 at 9:35 am

Do a good job, undertake education at every opportunity to increase skills and abilities, and you won't have issues staying at minimum wage.
Once again, Kate is bleating at the wrong end of the situation.
Effective government and service delivery shouldn't cost us half our paycheques in taxes, how about you start there Kate?! If we weren't taxed so heavily and facing government created inflation, minimum wage would go a lot further. Kate's always ready to point the finger at private businesses, instead of how government created the problems in the first place.

Up 20 Down 10

Totally real name on Nov 22, 2022 at 9:13 am

So capitalism REQUIRES a slave class of poor people in order to function.
Some system you poor folks are selling.
That's some system...

Up 21 Down 10

unReal on Nov 22, 2022 at 6:28 am

Looks like Currie doesn't have much respect for the lower wage worker!! I doubt that at election time he'll get their vote.

Up 19 Down 7

Ann MacDonald on Nov 22, 2022 at 6:17 am

Fair minded

Well Currie, why should highly paid public sector workers, who primarily support local small businesses, get more grants for home ownership and fuel reductions when the lowest on the wage gap are renters and generally take public transit as they can not afford a car? How does this help solve the low wage problem for them? It doesn't...it only benefits your own supporters. Look around Currie. You and the Chamber need to get out more! And get the facts.
Fair Minded.

Up 16 Down 16

iBrian on Nov 22, 2022 at 4:44 am

Seems like everyone’s wages should go up.
Free money for all!!!
I’m running for next Prime minister, vote for me and all your dreams will come true.

Up 28 Down 14

bonanzajoe on Nov 21, 2022 at 7:11 pm

I think a better idea is for the government unions to freeze their wages until the lower labour force catches up. That should also take care of the inflation problem.

Up 26 Down 9

Needs change on Nov 21, 2022 at 6:30 pm

The system is broken kids that can barely brush their teeth making $16 an hour should not happen. Make a age wage older employees get more than a 1st time teen worker. How about welfare you get $500 max or have given them the option to get off their butts and if they get a minimum wage job subsidized the rest. Lots of things the government can do to stop hitting small businesses and start thinking outside the box.

Up 10 Down 20

Wilf Carter on Nov 21, 2022 at 6:07 pm

Cost of living by Yukon and Federal Liberals which have driven Yukon into a major downturn. Shortage of housing, lack of training for Yukon jobs, like over 500 trades people. Carbon tax has created the biggest inflation since 1972.

Up 24 Down 14

Mandeep Sidhu on Nov 21, 2022 at 4:25 pm

How about once you work over 40hrs --- you receive your wage with no taxes taken off?

There is absolutely no reason that those that work more than 40hrs should be paying taxes on it. Our entire budget is created around the principle of the 40 hour work week
It's a cash grab that shouldn't exist and has no bearing in reality.

Up 36 Down 34

Mr Facts on Nov 21, 2022 at 3:28 pm

Minimum wage should be for welfare bums. You get up everyday and go to a job and contribute to society you shouldn't be poor. Period.

Up 53 Down 27

TMYK on Nov 21, 2022 at 2:47 pm

Good. Minimum wage should go up. The businesses complaining the loudest are also the ones with the most FTWs so I’m not overly sympathetic. The only downside here is that MLA/Minister wages are also tied to inflation.

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