Earlier this week, the provincial government announced that minimum wage is to be increased from $14.35 to $15, starting January 2022 — a pay rate which doesn’t even amount to a living wage in the majority of Ontario cities, according to Ontario Living Wage Network.
The COVID-19 pandemic has made the recent cost of living even more expensive, particularly due to the increase in rents and housing.
According to the new announcement, a full-time worker making the general minimum wage could see an annual earnings increase of $1,350 in 2022.
Most minimum wage earners are women, and nearly 73 per cent of working 15- to 19-year-old people earn a minimum wage, according to the Ontario government. In addition, those in retail, food services, and other hospitality workplaces often earn minimum wage.
“Ontario’s workers have been the unsung heroes of this pandemic, as they’ve stocked shelves, kept our supply chain moving, and helped so many of us enjoy a meal among family and friends at a local restaurant,” Premier Doug Ford in a statement.
“When we asked labor leaders what their priorities were, increasing the minimum wage was at the top of the list. As the cost of living continues to go up, our government is proud to be working for workers, putting more money into their pockets by increasing the minimum wage.”
After 2022, the minimum wage will increase as needed due to the rate of inflation.
And while the increase in the minimum wage looks promising, it does not help people with the cost of living, according to those who study living wage rates across the province. The new living wage for Kingston, also announced this week, is $17.75 an hour. That is $2.75 more than the minimum $15 per hour Ontarians will be making from January onward.
While they are few, Kingston does have listed living wage employers, including the City of Kingston, Kingston Community Health Centre (KCHC), Weller Pharmacy, Sustainable Kingston Corporation, Trailhead Kingston, and the United Way of KFL&A.
“The cost of living continues to rise, making it hard for people to make ends meet. We see increasing numbers of people who need to access local programs for basic needs like food, shelter, and mental health supports,” said Bhavana Varma, President and CEO of the United Way of KFL&A.
“United Way has been a living wage employer since 2018 and is committed to being a living wage employer, as we see firsthand the impact of precarious and underemployment,” she added.
Varma also explained that the living wage — as opposed to minimum wage — is a good measure for local employers, as it is customized for regions based on the cost of living and basic needs in each community.
Of all the expenses, housing and rent are the largest. In Ontario, the annual rent increase has been between 1.5 and 2.2 per cent over the past 10 years. In 2020, the provincial government announced a freeze on the rent levels; hence no increase in rent was seen in 2021. However that policy would end December 31, 2021 and the rise in rent in 2022 will be 1.2 percent.
Moreover, the annual inflation rate in Canada is somewhere around 3.7 to 4.5 per cent, which makes a living wage even more required currently.
The provincial discussion on increasing the minimum wage to $15 per hour started three years ago, but was just announced this week, to be implemented next year. The new announcement as stated that students under 18 who work 28 hours a week or less when school is in session are to receive $13.50 to $14.10 an hour.
Homeworkers who do paid work out of their own homes for employers will see an increase from $15.80 an hour to $16.50 an hour, according to the province, and hunting and fishing guides will be paid twice the amount they were being paid before: $143.55 for people working less than five consecutive hours (previously $71.75), and $150.05 for those working five or more hours a day (previously $75).