The Truth about minimum wage

Minimum wage and living wage are two different concepts:

Minimum Wage: - A legally established minimum amount that employers must pay their employees - Typically set by governments and varies by country, state, or region - Intended to provide a basic level of income for workers

Living Wage: - The amount of income a person needs to earn to support themselves and their family - Based on the actual cost of living in a specific area, including expenses like housing, food, and healthcare - Aims to provide a decent standard of living, rather than just a basic income Key differences: - Minimum wage focuses on a legal minimum, while living wage focuses on a sustainable income - Minimum wage may not be enough to meet the actual cost of living, while living wage is designed to do so. For example, in Canada, the federal minimum wage is $17.30 per hour, but the living wage varies by location. In Edmonton, Alberta, the living wage is around $22.25 per hour for a single person, while in St. John's, Newfoundland, it's around $24.20 per hour.

Minimum wage is nothing more than a legal requirement, but it often doesn't reflect the actual cost of living in a particular area. A Living wage, on the other hand, takes into account the real expenses people face, like housing, food, transportation, and healthcare. It's a more meaningful measure of a wage that allows people actually to live with dignity and meet their basic needs. Focusing on a living wage rather than just minimum wage can help ensure that people earn a wage that truly supports their well-being and allows them to participate fully in their communities. It's an important step towards creating a more equitable and just society.

So, how do we achieve a living wage for Canadians?

1. Tax cuts for the poor and middle class can increase their take-home pay, effectively raising their living wage. - For example, a tax credit or rebate could be implemented to reduce the tax burden on low, and middle-income workers, putting more money in their pockets. - This approach can be more politically palatable than a direct increase in the minimum wage, as it doesn't require an explicit government mandate.

3 Teaching people the principle of sound financial education. In the first quarter of 2023, the Canadian household debt-to-income ratio reached 184.5% meaning Canadians owe nearly $1.85 for every dollar of disposable income. - Canadians between the ages of 35 and 44 who carry debt had a total debt-to-disposable income ratio of 250% in 2019. - Indebted Canadian millennials (under age 35) had debt loads worth 165% of their disposable income. Teaching people the concepts of good vs bad debt, income protection, and efficient ways to grow wealth, is paramount to achieving a living wage.

Remember, increasing the living wage requires a collective effort from governments, employers, and communities to ensure that workers earn a salary that allows them to meet their basic needs and live with dignity.