October 4, 2022 Message to the Membership

OK, so I kind of hinted at this in last week’s message, but holy crap, here we are, it’s October already. In normal years, this is a welcome time but this year, October 1 brought with it a couple of governmental items that has caught the attention, and perhaps ire, of a few of us.?

Point number one, as of October 1, the Saskatchewan government has raised the minimum wage from $11.81 per hour to $13 per hour. This is the first of a three-step process, which will see it raised to $14 an hour one year from now, and up another dollar to $15 an hour on October 1, 2024.?

This is driven in large part by the fact that 1) we’re among the lowest in Canada on this particular front, which is not necessarily a good place to be; 2) labour groups and activists have been calling for a $15 minimum wage for quite some time and; 3) the labour force is not immune to inflationary costs that are appearing everywhere.?

Let’s dive into this a little bit. For background and for the record, the NSBA is in favour of indexation of the minimum wage, which is what we had in place for the past seven years until this October 1. What this indexation meant was that every year the minimum wage would be adjusted by the corresponding rate of inflation relative to the Consumer Price Index (CPI). So if the CPI goes up 4% say, then so does the minimum wage. If it goes up 8%, guess what? The minimum wage goes up 8 %. We believe that this is then data driven, as opposed to political or ideological driven. It made sense to us, anyway.?

This relatively new phenomenon actually began in 2015 when the government introduced the Saskatchewan Employment Act. Before then, it would change as these outside forces culminated, eventually resulting in a political response to corresponding political pressure.??

But now the government has shaken the formula up, saying that the baseline isn’t high enough and they’ve created a new set of parameters for employers to work within. You see, it’s not just the entry level positions making $11.84, now $13 an hour that’s affected. It’s everyone else who’s been making less than $13 an hour, up to now as well.??

But it goes far beyond that. Because what will happen is the people making $15 an hour will also want $3 an hour more for their time, to keep their wage relative to the minimum wage before this raise happened. The people making $18 an hour will want $22 or $23 an hour and so on.??

So it’s created a whole new floor and set of dynamics that businesses now have to contend with. That’s issue number one. The second issue is that there is only so much money to go around. Typically, businesses that pay minimum wage have a large pool of employees. Think hospitality, think fast food, think restaurants, think hotels. Not exactly the most lucrative of industries to be in as of 2020.?

If the economics don’t support having 10 people on a shift at $13 an hour (when perhaps it used to at $11.84), then they’ll go to nine people on a shift. So you’re actually causing more harm than good – particularly if you’re the odd person out.??

The other argument is that the market will dictate what people will work for. If you think you can get a job for more money, feel free to do so, it’s a free world. Chances are, if you’re worth it, you will. Especially in today’s market (but that’s another story!).?

The accompanying piece to this is that not too many employers are paying minimum wage to their staff – not in the NSBA anyway – because of those aforementioned market forces. If you want someone who brings certain attributes to the job, you’re likely paying more than minimum wage.?

The other facet to all this is that minimum wage jobs are not intended to be career jobs for anyone – particularly someone with a family. Rather, they are entry level positions that should be a steppingstone. Either to a better paying job through a merit-based or experience-based career opportunity, or impetus for that employee to get training and/or education that in turn makes their skillsets more valuable in the marketplace.??

The other item that October brought with it is an expansion of the PST to include entertainment items like going to the movies, bowling, golfing, or taking in a Rider game, for instance. Well, the problem with that is these industries (ok, take out golfing), like the aforementioned hospitality sectors, have been among the hardest hit during the pandemic. And their recoveries (again, golf excluded) have been anything but smooth.??

So you’re basically taking another slice out of an already-skimmed pie. (Remember, like the employers reference earlier, consumers only have so much to go around too!) So chances are, this PST hike likely isn’t going to be a welcome addition to those affected industries either.?

Until next time, be safe, be smart, be considerate, be well, but most of all, be kind.?

Keith Moen?

Executive Director?