The Good Ol’ Days
My two kids are still far too young to beÂ farmed out to earn their keep in the labour market, but when they are (in about a decade), I really hope that the value of minimum wages in Canada improves.Â
If not,Â not only are they going to have to workÂ harder and harder to get by along with millions of others young and old, but I’ll have to bore them with stories about the good ol’ days when minimum wages were worth a lot more.Â Â When I was starting to enter the labour force in the late 1970s, minimum wages in Canada provided a much more decent paycheck than they have since, or than they do today.
I’ve updated some calculations of whatÂ the real value ofÂ minimum wagesÂ are for different provincesÂ across Canada and included them in theÂ SeptemberÂ issue of the quarterlyÂ Economic Climate for Bargaining publication I produce.Â Â Â
ThisÂ shows that, despite recent increases, the real value of the minimum wage in every province of Canada is still less than what it was 33 years ago, with the exception of Newfoundland.Â That’s right, folks, the over half a million Canadians who are paid the minimum wage are distinctly worseÂ off now than they would have been a generation ago in 1976.Â Â All those whose wages are also positively influenced by the minimum wage (and that’s a lot of us) are also worse off.
The federal government’s national minimum wage of $2.90 in 1976 would now be worth $10.70 if it had kept up with inflation.Â The averageÂ minimum wageÂ across Canada from 1976 would now be worth $9.58: higher than any provincial minimum wage is now.Â
Thirty three years is a long time ago.Â That’s when the Bay City Rollers rose to music superstardom.Â Â I’m not suggesting we should go back to those days.Â Â We’ve made a lot ofÂ technological and social progress since then, but it hasn’t trickled down to better wagesÂ for most people — and especially for the poorest paid.
The low paid aren’t just youth or part-time workers.Â Â In 2008, there were 1.7 million Canadians who were paid less than $10 an hour.Â Almost half (47%) of these were full-time workers and 62% were women.Â Over 500,000 of them were adults working full-time.
These aren’t middling amounts either. If B.C.’s minimum wage had kept up with inflation since 1974, someone working full-time full-year would get a wage increase of $4,000 a year: enough to bring an individual living in a mid-sized city just about up to the LICO poverty line.Â That’s a lot more than they get from any tax cut.
In many ways the last thirty years of neo-liberal economicsÂ has been a lost generationÂ for most working people.Â As Statistics Canada showed last year in their report on Earnings and Incomes over the Past Quarter Century, the median earnings of Canadians employed full-time full-year changed very little from 1980 to 2005: earnings rose at the top end, stagnated in the middle and decline for those at the bottom.Â Â
Armine YalnyzianÂ showed inÂ the CCPA’sÂ The Rich andÂ the Rest of Us Â reportÂ Â not only has there been a dramatic increase in inequality of earnings over the past 25 years, but also everybody but the richest 10% Â are working longer hoursÂ just to get by.Â On top of this, MarcÂ Lee’s studyÂ on Eroding Tax Fairness showed that Â our tax system is now far more regressive than it was in 1990.Â TheÂ planned move by Ontario and BC to convert their retail sales taxes to a harmonized sales tax, shifting of billions in taxes from corporations to households, will no doubt make the tax system even more regressive.Â Â
After 30 years of regress on wages and taxes, it would be good to make more progress–for a lot of much more substantial reasons.Â Â But I also really don’t want to get nostalgic for those days!