Young adults likely hit hardest after minimum wage hike

BY SHANE ROBERTS

Starting Jan. 1, the minimum wage in Ontario will be raised from $11.60 to $14 an hour.

Small, locally owned businesses will be affected most by the change. The provincial financial watchdog issued a report saying that more than 50,000 people could lose their jobs once the minimum wage gets to $15 an hour.

The majority of lost jobs will belong to teens and young adults. They will feel the difficulty in getting part-time work during school or when they are looking for full-time work.

More and more people are working minimum wage jobs in Ontario according to the Financial Accountability Office. Half a million people work at the minimum wage right now, and that’s going to increase to 1.6 million in 2019.

Paul Zomer has owned a new and used sporting goods store in Georgetown since 2002. He employs five students who make minimum wage. Zomer is still trying to brainstorm ways to absorb the extra cost.

Some say students will be hardest hit with wage change. (Photo by Shane Roberts/The Sheridan Sun)

“During the course of the year, I average around 45 student hours per week. The increase to the wage of $10.90 on Oct. 1 will not affect my business significantly. However, the increase to $13.15 will cost me over $5,700 per year. The increase to $14.10 will cost me an additional $2,223 per year (for a total of $7,923). These are extra costs that will be difficult to absorb,” Zomer says.

More than half of all minimum age workers in Ontario are teens/young adults. Former Sheridan student Renato Sologuren, works for a small organic market in downtown Oakville. He says the owners of  his  workplace are worried about the wage increase. They are struggling to come up with a solution to pay everyone that works there.

“I think smaller business will be understaffed because they won’t be able to pay the employees. Where I work is already understaffed so I hope that we can still keep a good number of employees around after the change,” Sologuren says.

As for his job security “I hope that this will benefit people rather than make things more difficult for the company. I’m not sure how safe my job is going to be, especially since I’m only part-time. I hope that since it’s a small business they won’t want to risk losing a valuable employee,” Sologuren says.

Zomer doesn’t have a lot of options once the wage increase comes into effect. “I’m planning to reduce student hours beginning in January, 2019,” he says. “Increases to price of product is a consideration however, since increases to cost of product to the consumer are largely impacted by my cost of product,” he adds.

Come Jan. 1, only those under 18 will be effected by the wage increase at Zomer’s business. “All of my full-time employees make over the minimum wage increase coming in October and January. Only my employees under 18 will be impacted by the wage increase,” Zomer says.

Some experts say that the wage increase is coming into effect too fast and that it doesn’t give business enough time to prepare.

 

 

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