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Ontario minimum wage goes up by 15 cents: shopping spree?

September 30, 2016

2-minute read

On October 1, the 800,000+ workers who earn the minimum wage in Ontario will get a raise, but don’t celebrate too quickly: it’s going up by a mere 15 cents an hour.

To put that into perspective, that’s $1.20 more a day or $6 more a week.

The hike represents the second year of the Ontario government’s commitment to annually adjust the minimum wage to inflation, which is a good idea.

But, given the fact that a full-time, full-year minimum wage worker still lives below the poverty line, it’s important to ask: what does a 15 cent raise buy in 2016?

Our researcher Jordyn Perreault-Laird steadfastly set out on a shopping spree to find out.

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For 15 cents, Jordyn found three sugar sticks in neon orange, green, and yellow. Knock yourself out.

For $1.20 a day, Jordyn found a couple of timbits and a cappuccino pod (assuming you have a Keurig-style coffee brewing system — or you could use the cappuccino as a rub for a cheap cut of meat …).

For $6 a week, Jordyn found a fantastic Pez candy dispenser, with a week's worth of refills. Just in time for Halloween (trick? or treat?).

There is another campaign out there with the number 15 in it: it’s Ontario’s $15 & Fairness campaign, which is calling on the provincial government to move the minimum wage from its current rate of $11.25 an hour ($11.40 on October 1, 2016) to $15 an hour.

At 15-cent annual increases, it will take until 2040 for Ontario to reach a $15 minimum wage, so clearly, relying on annual inflation adjustments isn’t the ultimate solution.

In comparison, the Alberta government is raising its minimum wage by $1 an hour on October 1, which will bring it up to $12.20, and it has committed to raise its minimum wage to $15 an hour by October 1, 2018.

It is the first province to commit to a $15 minimum wage, but you can bet the pressure will grow on competing provinces to quickly follow suit.

The good news is that a $15 minimum wage would put Ontario minimum wage workers within about 60 per cent of the average industrial wage — that would be a good rationale for any government intent on addressing income inequality and embedding a sense of fairness in the labour market.

A $15 minimum wage still falls short of what it takes to earn a living wage in most Ontario communities (in Toronto, for example, the living wage number was $18.52 in 2015) but it would be a step in the right direction.

So, on October 1st, I will think about those sugar straws, the timbits, and the Pez dispenser that the 15-cent increase will buy a minimum wage earner as a reminder that Ontario still has a long way to go to end working poverty in this province. We know we can do better.

Trish Hennessy is director of the Canadian Centre for Policy Alternatives’ Ontario office. Follow her on Twitter: @trishhennessy.

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