Making Peace Vigil

Standing up for peace

HAPPY LABOUR DAY

Posted by strattof on September 2, 2011

Labour Day is an annual holiday to recognize the economic and social achievements of workers. In Canada, it traces its origins to December 1872 when a parade was staged in support of the Toronto Typographical Union’s strike for a 58-hour work-week. Since 1894, it has been celebrated on the first Monday in September.

Today, Canadians tend to treat Labour Day as the last holiday weekend of summer. But whether we are barbequing on the patio or cheering on the Riders in the Labour Day Classic, we can take a moment to acknowledge the many accomplishments of Saskatchewan workers. We might also spare a thought for the many challenges faced by the province’s workers, in particular those who work for the minimum wage.

THE MINIMUM WAGE: COULD YOU LIVE ON IT?

Today, September 1 2011, the minimum wage in Saskatchewan went from $$9.25 to $9.50 an hour. This 25¢ increase won’t do much to help low-income earners’ frail standard of living.

  • It is the first increase in Saskatchewan’s minimum wage since May 1 2009. A mere 2.7% rise, it does not keep pace with the increase in the Consumer Price Index (CPI) in Saskatchewan, which over the same period went up by 4.1%.
  • Nor does a 2.7% increase in the minimum wage keep pace with the rate of rent increases in Regina. Since May 2009 the average cost of a two bedroom apartment has gone from $832 to $897, a 7.8% increase.
  • The average monthly rent for a one bedroom apartment in Regina in April 2011 was $770, an increase of $53 (7.4%) a month from the previous year. Assuming a 40-hour work-week for 4.34 weeks a month, individuals earning $9.50 an hour would spend approximately 46% of their before-tax income on rent for a one-bedroom apartment. The Canadian Mortgage and Housing Corporation defines “Affordable Housing” as costing a household 30% or less of its before-tax income.
  • From May 2009 to July 2011, food prices went up by 4.6%.  
  • From 2009-2010, there was an increase in the number of minimum wage workers using the Regina Food Bank. Across Canada, 1 in 5 of the total food bank users is a family in which someone is working full-time.

 WHO WORKS FOR THE MINIMUM WAGE?

The minimum wage was originally implemented in Canada to protect women from being exploited as cheap labour. To this day, it serves as an important tool for protecting vulnerable workers.

  • Approximately 31,000 people, or 7.3% of the labour force, earn the minimum wage or less in Saskatchewan.
  • 60% are women.
  • 38% are between the ages of 25 and 55.
  • 40% work in the retail trade, while 27% work in accommodation and food services.
  • 78% work in permanent jobs.

As Premier Brad Wall keeps reminding us, “Saskatchewan is leading the nation in economic growth.” Why then does Saskatchewan have the 5th lowest minimum wage in Canada?

BOOM AND BUST, OR EXCESSIVE INEQUALITY

The rich are getting richer and the poor are getting poorer. In Saskatchewan, income inequality has increased dramatically over the past three decades, with the wealthiest 10% of families making the greatest gains.  

  • Between 1976 and 2006, the richest 10% of Saskatchewan families increased its share of earnings from 23% to 28% of all earnings in the province. In contrast, the share of earnings of the bottom 50% of families declined from 26% to less than 20%.
  •  In 2006, the richest 10% of Saskatchewan families had after-tax incomes of over $110,000, while the poorest 20% had incomes of less than $17,626.
  •  In 2006, the median income of the poorest 10% of Saskatchewan families was $15,400.
  •  In 2006, the poorest 20% of Saskatchewan families received only 6% of all Saskatchewan after-tax income. In contrast, the richest 20% received 40% or 6.5 times as much.

Minimum wages are one of a set of tools in the battle against poverty and excessive inequality. Who would be against raising the minimum wage and at the same time be uncritical of the wages of CEOs? In 2010, the CEO of PotashCorp took home $11,264,973, while a full-time minimum wage worker earned $19,240.

How much inequality is too much inequality?

WHAT CONSTITUTES AN ADEQUATE MINIMUM WAGE?

1.   For the minimum wage to remain adequate over time, it must be indexed either to the CPI or the annual change in average earnings–as are other government programs such as Old Age Security, the Canadian Pension Plan, and Employment Insurance. In May, the Saskatchewan government turned down the recommendation of the Saskatchewan Minimum Wage Board that the provincial minimum wage be indexed to the CPI.

2.   However, indexing only works if there is an adequate minimum wage to begin with. One way of achieving adequacy is to raise the minimum wage until it equals or exceeds the poverty line or low-income cutoff (LICO). By this measure, Saskatchewan’s 2010 minimum wage of $9.25 ($19,240) was inadequate for the majority of its minimum wage workers, as the LICO before tax for a single individual living in an area with a population of 100,000 and 499,000 was $19,496. (The discrepancy would be much greater if the LICO was able to take into account the extraordinarily high rate of rent increases in the province’s urban centres.)

3.   Another way to achieve adequacy is to start with the highest minimum wage in Saskatchewan history. That was in 1976 when the minimum wage was, at $2.80 an hour, worth 118% of the poverty line. Indexed to the CPI from 1976 through 2010, the minimum wage in 2010 would come to $10.45. Indexing to the increase in average earnings would result in an even higher minimum wage: $11.13 an hour.  

TAKE ACTION

  • Find out more about the minimum wage by reading a new report from the Caledon Institute of Social Policy: Restoring Minimum Wages in Canada. Also read Boom and Bust: The Growing Income Gap in Saskatchewan by Paul Gingrich. Both are available online. Much of the information in this leaflet is taken from these publications.  
  • If you work at a secure job, think about joining with others in a one-hour strike on behalf of minimum wage workers.
  • Make the minimum wage an issue in the upcoming provincial election. Tell the candidates in your constituency you want Saskatchewan’s minimum wage to meet the criteria of adequacy.

From each according to his ability, to each according to his needs.’

Karl Marx

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