Stratford Gazette editorial
The Social Research and Planning Council’s new report A Living Wage: What it takes to make ends meet in Perth and Huron Counties claims that an hourly wage of $16.47 an hour is needed for a family of four- two parents and two children- to have a stable existence.
This number was reached by factoring together a number of necessary monthly expenses: $701 for food, $929 for vehicle maintenance, $1,182 for rent and utilities; $154 for clothing and footwear, and $323 for recreation and leisure, which, over the course of one year, would include a family pass to the YMCA, a one-week camping trip to the Pinery, one trip to Wonderland, one modest restaurant meal a month, four outings to a movie, and two junior hockey games.
So, in total, the council concluded that a family would have to make at least $60,000 a year in order to make ends meet. However, in 2010, half of all households in Perth and Huron counties earned below that number.
But let’s not talk about what’s included in that imaginary family’s budget; let’s talk about what isn’t. First, student loan repayments are not included, and as many young Ontarians know, student loans are this generation’s mortgages, trumping most other payments and expenditures and severely stifling any opportunity for home ownership.
Second, savings for retirement. This report chronicles what is needed to get by day-to-day, not what is needed for the future. Third, saving for your children’s education. Without this in a budget, see point one. Fourth, pets. Sorry kids, we either cut the Internet or pay for Rover’s meds. Not both.
And sixth, vices. Cigarettes and alcohol were not included, and while we might fault those who bump this category up on the priority list, it remains a factor people struggle with.
What is most troubling about this report is that $16.47 is not the number needed to live a comfortable and fulfilling lifestyle; it’s the minimum needed just to keep your head barely above water, and half the population is failing to reach even that.
Ontario’s current minimum wage is set to jump from $11 to $11.25 in October. That’s a gap of $5.22 per hour that’s missing.
Enter the same old arguments against raising the minimum wage: It’ll kill small businesses; it’ll jack up the price of goods and services; why rob Peter to pay Paul; etc.
Most arguments against raising the minimum wage revolve around the idea that there are a multitude of factors involved; that raising the cost of labour will have negative effects on all other facets of commerce. However, what these naysayers fail to see is that the door swings both ways. Raising the minimum wage will also bring substantial benefits to the economy. Never mind effects like employee loyalty and wellbeing; the bottom line is that the entire economy is buoyed when a majority of people have an expendable income.
American billionaire Nick Hanauer said in his now-famous Ted Talks session, “Somebody like me makes hundreds or thousands of times as much as the median American, but I don’t buy hundreds or thousands of times as much stuff.”
He points out that, despite his fortunes, his family owns three cars, not three thousand.
Meanwhile, his accumulated wealth, spread amongst several million average citizens as expendable income, would result in vastly more cars, clothing, and luxury items sold.
“Rich people do not create jobs, nor do businesses large or small,” he said. “Jobs are a consequence of a circle of life-like feedback loop between customers and businesses; and only consumers set in motion this virtuous cycle of increasing demand and hiring.”
In short, calling the wealthiest one per cent of citizens “job creators” is a myth. The real job creator is a populace able to afford goods and services. And how do we ensure that populace has enough money to keep the economy buoyant? We pay them wages that are fair and healthy in exchange for the work that they do.
If you want proof that trickle-down economics have failed in their promises of prosperity, one need only look at the economic history of the past 30-odd years since neo-liberal economic policies took hold of many western democracies. Therein one sees a general slow and steady rise in unemployment, the accumulation of wealth at the top, and the stagnation of wages for the average person.
It’s time to stop lying to ourselves and start being smart with the management of our economies. We cannot leave the prospect of a living wage up to a competitive marketplace that has proven itself notoriously shortsighted. Though the extra labour cost might sting companies at first, a significant bump to the minimum wage means more paying customers, and that’s good for business.