Brown mirrors Wynne on the minimum wage

Printer-friendly version
Appeared in the Ottawa Sun, December 13, 2017

Recently, the Ontario Progressive Conservative Party (PC) released its election platform. In many policy areas, the platform calls for only vary small variations on the course charted by Premier Wynne's governing Liberals. This is especially true when it comes to minimum wage policy.

This year, Premier Wynne's government announced a large increase to the province's minimum wage. Specifically, the government has passed legislation that will raise the hourly minimum wage from $11.60 to $14 on January 1, and then by another dollar to $15 at the start of 2019.

PC Leader Patrick Brown and his party have at times been critical of the government's plan, rightly saying it will cost young and less-skilled Ontarians jobs. Canadian evidence consistently shows that higher minimum wages tend to slow the pace of job-creation, with young and less-skilled workers largely bearing the brunt of these negative effects. What's more, international evidence suggests higher minimum wages can cause more businesses to go out of business and prevent others from being created.

Given that Brown has said that the government's minimum wage hike is "too much, too soon" and that this phrase is repeated almost verbatim in the platform itself, it was disappointing to see that the actual policy prescribed by the PCs is almost identical to what the Liberals are plan to put in place.

To start with, a PC government would leave in place the proposed jump from $11.60 per hour to $14 set to take effect at the start of next year. In other words, while the PC platform warns that a too-fast increase in the minimum wage could force businesses to “lay off thousands of workers or close up shop,” the very next paragraph says that a PC government would leave in place a policy that will increase the minimum wage by 20 per cent overnight.

It's only in the implementation of adding the last dollar to get to $15 per hour that the PC plan differs from the policy status quo under the Liberals. Specifically, a Brown government says it would complete the process of moving to a $15 minimum wage over a four-year period, increasing the wage floor by $0.25 annually to reach the target by the end of its mandate.

In short, the two parties' approaches to minimum wage policy are so similar that you have to squint to see the difference. No matter which party is elected, Ontario's businesses will have to adjust to a $14 minimum wage next year and then to a further increase to $15 in the years ahead, with the only difference being that the Liberals are in a bit more of hurry to get there. In either case, the result will be slower job-creation for young and less-skilled Ontarians and an additional burden on local businesses that will make it harder for them to survive, let alone thrive and grow.

Simply put, the PC platform has essentially ratified the Wynne government's policy direction on the minimum wage. On this issue, as in other policy areas, voters are essentially being asked to choose between slight variations of the policy status quo, when what Ontario's economy really needs is a fundamental change in direction.

Subscribe to the Fraser Institute

Get the latest news from the Fraser Institute on the latest research studies, news and events.