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Wage increases expected to create change at County businesses

The Prince Edward County Chamber of Commerce, in a survey of membership, learned minimum wage increases may change how some County workplaces operate.

Emily Cowan, the chamber’s executive director, said the survey focused on the increase in minimum wage by $2.40 in January 2018 and a further $1 in 2019.

Emily Cowan

She noted most employers agreed with the increase in minimum wage, but in increments over a longer and more manageable time-period. A one-time pay increase of more than 20 per cent, the survey learned, “will be insurmountable for some, especially when these small businesses haven’t had the time to budget for it.

“Some of our members budget for the winter payroll by putting aside enough resources during the summer to cover employment costs through the winter months – a late spring announcement which proposes increasing wages by 20 per cent within six months just isn’t feasible for many.”

“The bulk of respondents employed between one and five employees, although staff sizes represented also consisted of six-10, 11-25 and 26-50 person workforces,” she said.

“Less than 10 per cent of the County’s respondents paid all their employees minimum wage. The majority (67 per cent) paid all their employees above minimum wage,” said Cown, adding the remainder of the businesses who responded paid their new employees at minimum wage, increasing that wage after a certain number of months of service.

“When asked about the cost to their business of a 20.7 per cent increase in wages (from $11.60 in October to $14 in January) there were varying responses depending on how close to $14 companies were currently paying their staff.”

The result for 36 per cent of employers, she said, will be a decrease in hiring new employees next year.

“The cost to maintain the staff they currently have at increased wages is significant enough that they will not hire new employees in 2018. This was followed closely by seasonal businesses who were considering staying open over the winter, 21.4 per cent now deciding they definitely will not stay open during the winter months. 14 per cent of the respondents will be laying off staff, 14 per cent foresaw no change and seven per cent are considering closing altogether.”

Cowan said some businesses reported they will have to pass on their costs directly to the price of their product or service while others who were affected by last summer’s construction, water/wastewater increases and lack of affordable housing, are considering relocating out of the County.

“One member replied that small businesses in rural areas work very hard to serve their communities while being fair to their employees “they’re often our friends and neighbours”. They lament the rise in Hydro, the US exchange rate, taxes, remittances etc. which means there’s very little left to live on at the end of the month.”

Cowan will be taking the results, along with a wider Bay of Quinte Chamber survey, to a Finance Committee Public Hearing in Kingston, July 13, where she has requested to make a statement.

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  1. Dennis Fox says:

    Marnie – You have made excellent points!

  2. Marnie says:

    It all depends on your level of income Dennis. An increase is in order, overdue even, but there will be seniors paying for yard work, housekeeping etc who will blink because they are on fixed incomes that are not going to increase to keep pace with the cost of living.

  3. Dennis Fox says:

    I don’t believe anyone felt that the increase in the minimum wage was going to happen without some impact. However, this increase has been talked about for the last few years and it should not have surprised anyone – also it is the right thing to do. Parents in The County have expressed concerns about their kids affording to go to college – and still being able to remain here. As the survey showed – this increase will have to be paid for in the price of the product or service, just as it will be across the province – this is called reality. As member of the public, I will continue to support the local economy – we will survive this without a blink.

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