The two sides of the minimum wage debate

Small business owner Jason Macfarlane, like many employers in Ontario, sees the proposed new minimum wage increases as "too much, too soon."

Macfarlane, who owns Wimpy's Diner on Wyndham Street, agrees with the increases in principle and many of his small staff are already making above the proposed new minimum wage of $15 an hour. But he believes such a jump will create hardship for small business owners operating on narrow profit margins.

"I agree with what they're trying to do and I would agree with it if it was being done with the most honest of intentions and if it was done over a period of time," said Macfarlane.

"The cost of doing business just keeps going up. You're going to have to make that up somewhere," he said.

Small businesses will be faced with little choice other than to cut hours, cut staff or raise prices, he said.

Legislation introduced at Queen's Park Thursday and announced earlier this week calls for minimum wage to increase to $15 by 2019. The plan is receiving mixed reviews, nationally and locally.

Those supporting the move say it is a huge step in the right direction of providing a living wage for those at the bottom of the pay scale.

Those opposed to Premier Kathleen Wynne's announcement earlier this week feel it is a case of 'too much, too soon.'

Under the proposal, the current minimum wage of $11.40 per hour will increase to $14 at the beginning of 2018 and $15 at the beginning of 2019.

Randalin Ellery, coordinator with the Poverty Task Force at Wellington-Dufferin-Guelph Public Health, was "thrilled. REALLY thrilled," when the announcement was made earlier this week.

"We were expecting an announcement about increasing the minimum wage and had our fingers crossed for $15 an hour ... but quite surprised with the timelines the provincial government has committed to."

Ellery said they expected the $15 mark to be phased in over five years, which is what happened in Alberta.

"We're really thrilled this is going to be phased in over the next 18 months," she said.

Is it enough in a city like Guelph?

"In our community we've calculated that the living wage is $16.50 an hour," Ellery said. That "living wage" is a voluntary commitment that 25 employers in Guelph thus far have committed to.

"I think local employers are understanding the importance of paying what it costs to live here, but if we're talking about that floor level, $15 is certainly a lot better than the $11.40 we have now," Ellery said.

Kithio Mwanzia, president and CEO of the Guelph Chamber of Commerce said the business community didn't see this coming.

"It's the surprise factor that makes things challenging," he said.

While not opposed to seeing wages gradually increase, Mwanzia said "predictability is everything in business" and businesses has not foreseen the big leap in costs that the increased minimum wage proposals would bring.

"Minimum wage had never featured as part of the conversation in the Changing Workplaces Review," he said.

"This will have significant adverse affects and business will have to react to it."

He has already heard that less summer hiring of students is one thing businesses will be doing as an initial reaction.

The Ontario Keep Ontario Working coalition and the Ontario Chamber of Commerce, which has 60,000 members, said the changes are short-sighted.

"Government cannot regulate prosperity," they said in a joint statement.

Local businessman Macfarlane, echoing the sentiments of many, feels the announcement by Wynne has as much to do about politics as it does economics.

"I think this is more vote buying than anything else and that's why it's being rushed in before an election without any concern for the repercussions."