While some are excited about BC’s upcoming minimum wage hike and others feel it doesn’t go fare enough, Prince George’s Chamber of Commerce is concerned about the impact on local businesses.
“The problem we have is the fact that they’re no longer tying it to the Consumer Price Index. They’re basing it on economic performance,” says Chamber CEO Christie Ray. “But it’s hard to operate a business that way. It’s hard to have the uncertainty of not knowing what it’s going to be.”
September’s increase will be 40 cents, four times the usual CPI rate. Premier Christy Clark justified the additional increase by referencing BC’s recent economic strength and the province’s rosy economic forecast.
“Costs are very much tied to labour and increasing minimum wage will have a very large effect on small businesses,” says Ray. “Some businesses in Prince George have indicated that it may potentially mean the need to reduce the number of employees or cut back on employee hours.”
Premier Clark says the government will offset the impact on small businesses by slashing the small business tax rate by 40%. But the tax cut won’t come through until next year and Ray says that’s not soon enough.
“That certainly is something that we recognize and appreciate. That kind of thing is important and that’s wonderful that they’re going to be reducing the small business tax from 2.5% to 1.5% in 2017,” she says. “I think it still doesn’t necessarily make up for the fact that businesses are going to have to alter staffing and things like that for September.”
Ray was more optimistic about the government’s plans to pour $2.8 million dollars into jobs training programs. The bulk of that money will go into a new Canada Job Grant stream that will pay for the costs of training new employees who were unemployed prior to receiving the training.
“Opening up any potential labour market that is under utilized is a great idea especially as we move into a time that is predicted to be filled with a lot of economic development,” Ray says. “We’re going to need employees and we’re going to be looking at various underutilized labour markets so anything that can ease that process is a good thing.”
BC’s minimum wage is currently the lowest in the country at $10.55/hour. This September’s boost will raise it to $10.85, putting BC behind Nunavut, Northwest Territories and Ontario. In 2017, another 40 cent increase will see minimum wage workers making $11.25/hour in BC.
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