According to the Central Intelligence Agency’s World FactBook, 9.4 per cent of the Canadian population lives under the poverty line as of 2008. That is equivalent to about 3.3 million Canadians, and even more are considered poor. One of the greatest reasons for Canadian poverty is that minimum wage is not a living wage.
Part-time and full-time minimum wage workers all over Canada are struggling to pay the bills, even while working two or three jobs. An article in the Huffington Post written by Daniel Tencer, explains that the price of goods is rising at a higher rate than minimum wage. On average the Canadian wages grew 1.6 per cent less than the inflation rates, and in Ontario, there has been a 0.7 per cent inflation-to-wage difference in the past year. This is a problem for all citizens because the strain of keeping up with expenses will increase.
Financial insecurity is a social issue because it is increasing poverty rates, and it is being influenced by people who are forced to raise their families on a minimum wage income. Through my experiences I have found that poverty is a vicious circle of the rich getting richer and the poor staying poor.
In this day and age, to get a well-paying job, people generally need to have higher education. 30 years ago it was not a social construct to receive further education or perhaps people did not have the money to attain a post-secondary degree, so many went straight into the workforce following high school. Now those without higher education trying to find a job may face issues with job eligibility, leaving only minimum wage jobs for the taking. This creates difficulties when trying to cover all expenses, especially with the inflation rate rising faster than the wage rate.
I have noticed this occur with a family that I have worked with in the past. The single mother of two children who I babysat for only had a high school diploma. She could not afford receiving a post-secondary education, and is now constantly in between part-time jobs, and picking up extra work wherever possible. She frequently expressed times of financial stress and could not seem to find any better paying jobs. This is an example of the poor staying poor because they do not have the opportunity to improve their situation with the minimum wage not being equivalent to a living wage.
On the contrary, some may argue that the minimum wage has already increased significantly over the past, and it is up to the business owners to raise the wage accordingly, to fairly pay workers for the job that they are doing. This is a good point, but it does not always occur this way in the workplace. Many times employers take advantage of the minimum wage and automatically pay their employees this, even if they are doing more work. This will require a shift in attitude on the employer’s part about what their employees deserve. However, the definition of ‘more work’ is subjective and workers are often left with the short end of the stick. I believe that raising the minimum wage will create a wage that can be considered fair for majority lines of work.
Raising minimum wage may surprisingly also reduce health problems. A 2010 Statistics Canada survey found that work and finances were the main causes of stress. Bree Akesson from Wilfrid Laurier University explained that financial insecurity can be a social determinant of health. This means that low income rates are associated with higher mortality rates, including suicide, adult-onset diabetes, and heart attacks. The American Psychological Association discusses the impact that high levels of stress have on the physical body including weight loss or gain, higher levels of blood pressure, rise in blood sugar, irregular hormone levels, and overall physical drain. Perhaps closing the gap between minimum wage and a living wage will decrease the number of stress induced health problems.
Taking everything into account, raising the minimum wage will allow for workers to earn closer to a living wage and become more adjusted to the inflation rate. Doing so may positively influence financial stability and could lower the number of Canadians living under the poverty line, essentially creating a healthier population. Reducing the gap between minimum and living wage will create an environment of less financial tension and benefit Canada as a whole.