Alberta Defends Having the Country’s Lowest Minimum Wage

Alberta’s UCP fears it will trigger further youth unemployment if it raises Alberta’s minimum wage, Nathan Neudorf, the affordability minister, said last week.

Neudorf said the government is treading carefully because youth unemployment in Canada is at “extremely high levels.”

Older Albertans working at minimum wage might also see their jobs eliminated if the government gets it wrong, he said.

Alberta has the country’s lowest minimum wage at $15 an hour, after all other provinces and territories made increases in recent months.

The NDP introduced a private member’s bill to change that Oct. 30.

NDP caucus whip Kathleen Ganley’s Bill 201 would increase the minimum wage to $16 an hour, with successive increases of a dollar next year and in 2027. After that, the law would tie annual increases to the consumer price index.

Ganley, the member for Calgary-Mountain View, told the legislature that her bill would help address Alberta’s “unprecedented affordability crisis.”

Passage of the bill — unlikely because it would require UCP support — would also kill a special lower-wage category for students under 18 who work while school is in session. The rate of $2 less than the general minimum wage applies to their first 28 hours of work in a week.

Alberta is the only province or territory in Canada without indexed minimum wage increases. Ontario, meanwhile, is the only other jurisdiction with a sub-minimum for school students working limited hours.

A list compiled by the federal government shows that the highest minimum wage in Canada is in Nunavut, at $19.75 per hour. B.C.’s minimum wage is $17.85 per hour and Saskatchewan’s is $15.35.

The law would also require that regulations be set to prevent managers from participating in tipping pools in the service industry.

Statistics Canada reported the national youth unemployment rate and Alberta’s at 14.7 per cent in September. Last year for the same month the national rate was 13.5 per cent and Alberta’s was 14.3.

Also in play is programming aimed at youth employment, which the government has taken a stab at with $8 million under the Alberta Youth Employment Incentive.

The program will subsidize employers in their hiring of perhaps 2,500 young Albertans through an application process begun last month. Up to $7,500 per employer is available.

But Opposition house leader Christina Gray said the UCP has already ditched an effective tool called the Student Temporary Employment Program.

“This government cut the STEP program, and now they’re proud to reinvent the wheel after they’ve created the problem,” she said.

Dating back to the 1972 Progressive Conservatives under Peter Lougheed, STEP offered a wage subsidy to employers that, in its later days under the NDP, reached $7 an hour for eligible positions.

The program was first axed under the Alison Redford PCs in 2013. The NDP bought it back in 2016, but it was again eliminated in 2019, this time by Jason Kenney’s UCP.

Neudorf, the UCP member for Lethbridge-East, said NDP increases to the minimum wage were followed by 21,000 Alberta job losses to young people. From 2015 to 2018, the wage rose to the current $15 from $10.20 under the NDP.

A panel struck by the UCP in 2019 reviewed the effects of increasing the minimum wage. Chaired by a University of Calgary economist, the panel estimated losses of youth jobs at between 21,000 and 26,000.

Organized labour wasn’t represented on the panel, but workers, post-secondary students, academics and businesspeople were.

“It’s not a coincidence that wage hikes have ended during the UCP’s time in government,” said the NDP’s Gray. “This is not a government that believes in paying workers fairly.”

Gray, who represents Edmonton-Mill Woods, called the lower rate for students “cheaper child labour” that incentivizes businesses against hiring older young adults.

Neudorf estimated that 95 per cent of working Albertans already earn more than minimum wage. As for the five per cent who don’t, keeping them employed while boosting minimum wage is a delicate calculation.

“If we raise it too high, like the NDP did, the result is that they’ll lose their jobs, hardly helping in this situation,” Neudorf said. “This is a conversation we’re having carefully with those who are employed and those who are employers to make sure that we get it right.”

But Gray said the affordability situation is desperate for many Albertans and the government is unresponsive. “Thousands of families make the minimum wage in Alberta, and they’re still living below the poverty line, and they are unable to lift themselves out of poverty,” she said.

“Alberta will lose its status as an economic powerhouse if workers here cannot afford the basics.