Who Is Making Minimum Wage?Is Raising Minimum Wage Good Social Policy?

 In a previous post, we discussed the impact that an increase in minimum wage would have on employers.  Let’s now turn our attention to the employees. 

One of the arguments for raising the minimum wage to even higher level is that at current level, the minimum wage does not provide an adequate level of income.  Someone supporting themselves fully and earning minimum wage would earn far less than is required to support a family of four. 

Statistics Canada, in its Perspective on Labour and Income (March 2004 and January 2009 issues) provides comprehensive analysis and descriptions of minimum wage workers.  

Table 1 compares employment figures for 2003 and 2008.  We see a larger increase in the number of employees earning minimum wage than the overall increase in employment. 

Table 1 Minimum Wage Earners in 2003 and 2008

2003

2008

Total Employees

13,333,200

14,496,200

Employees Min Wage

547,000

751,400

Percentage of Earning Min Wage

4.1%

5.2%

Table 2 shows the distribution of minimum wage earners across age groups.  We note an increase of minimum at all ages but the largest proportion of minimum wage earners are youth employees.  More than 45% of minimum wage earners are between 15 and 19 years of age. 

Table 2 Age Distribution of Minimum Wage Earners

2003

2008

Employees Min Wage

547,000

751,400

15 to 19

260,000

345,400

20 to 24

84,100

130,700

25 to 34

60,100

73,200

35 to 44

57,200

68,000

45 to 55

50,400

76,800

55 and over

35,200

57,300

Supporters of minimum wage say it increases the living standards of workers and decrease poverty.  Opponents of minimum way maintain that if it is high enough to be effective it increases unemployment, particularly among inexperienced workers. 

 Arguably, some teenagers will make contributions to their overall family income.  However, most teenagers work to earn spending money for themselves or to contribute to their education.    In other words, it would appear that the overall social benefit of increasing the minimum wage is to put more money in the hands of spending youth.

Considering 45% of those making minimum wage are youth between 15 and 19 years-of-age do you believe that raising the minimum wage is good social policy?

Is raising the minimum wage a good social policy?

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In the third part of our discussion on minimum wage, we’ll examine who else is earning minimum wage.

3 Responses to Who Is Making Minimum Wage?Is Raising Minimum Wage Good Social Policy?

  1. Alicia Mollica 2009/08/24 at 3:12 pm #

    Initially, I felt strongly that raising minimum wage was neccessary due to growing cost of living, poverty levels etc. However, raising minimum wage had only provided very temporary relief to struggling families and singles who were finding themselves constantly in the red. Shortly after the raising of minimum wage, we saw a huge increase in things such as goods and services, thus eliminating the benefits of the wage increase completely. For those making minimum wage, it’s impacted them the same or worse than it has before. Similarily, those making a bit above the minimum have been hugely impacted in every way. Many did not see an increase on their end, yet the taxes and costs have all gone up, putting them on a level at which the minimum wagers were. I beg to differ on the stats that 45 percent of all minimum wagers are students. I don’t agree with that number or feel that it is accurate. The raise has also caused increases in social assistance, which is also badly impacting the middle of the road employees, again, through higher taxes. We should be spending more money in social development programs that put the career welfare people, who are quite capable of working, whether on disability welfare or not, back into the workforce, where they can contribute to our economy. We are seeing a huge majority of youth, that come from welfare families and public housing, themselves going into social assistance as soon as they turn the age of majority. This has become a way of life, and a guaranteed paycheck to them. They are also using up the resources of getting right into public housing and co-op programs that should be available for struggling families. These areas, I feel, are where we should start concentrating our efforts for change and creating a stronger economy. The United States in many areas have already started, thus forcing these individuals into the work force, and off of the working taxpayers tip.

  2. pjonesdotca 2009/08/24 at 10:49 pm #

    Ah my friend but if you look at the data, which age segment has the largest increase? You’ll be surprised…

    Age 2003 2008 Per. Increase
    15 to 19 260000 345400 24.72%
    20 to 24 84100 130700 35.65%
    25 to 34 60100 73200 17.90%
    35 to 44 57200 68000 15.88%
    45 to 55 50400 76800 34.38%
    55 and over 35200 57300 38.57%

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  1. Wage web » Pros of Raising Minimum Wage - 2010/08/28

    […] 11.Who is making minimum wage? | hr-pros.ca One of the arguments for raising the minimum wage to even higher level is that at current level, the minimum wage does not provide an adequate level of income.  Someone supporting themselves fully and earning minimum wage would earn far less than is required to support a family of four.  … The Latest from HR pros… https://hr-pros.ca/who-is-making-minimum-wageis-raising-minimum-wage-good-social-policy/ […]

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