Raising minimum wage with the market

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bruce_the_vii
Raising minimum wage with the market

 

.....................................Low wages in Canadian Cities

.......................................2008, pre-world recession

 

 

........................................Best Performing Cities

 

City.........Percent of Adults............Official...............Real Unemployment

.................(People over 20)...........Unemployment........(Relative to Alberta

................Earning less $12.........................................-Calgary

.....................an hour...............................................at 2008 peak)

 

Calgary...............7.4%........................3.5%.....................3.5%

Edmonton............9.6%........................3.7%.....................6.0%

Red Deer............8.1%........................4.3%...............full employment

 

.......................................Main Cities of Canada

 

Montreal............16.7%........................7.4%.....................17.5%

Toronto...............16.5%..............................6.9%.............................16.0%

Vancouver............14.8%.....................4.3%......................14.8%

 

The number of workers earning less the $12 an hour is sharply different in the better economies. It follows that the de facto minimum wage, rather than the lower legislated minimum wage, is $10 to $12 in the best cities and $8 to $10 in the main cities. In Canada the three main cities are immigrant driven and have been flooded with new comers for a long time. This has caused unemployment, made people to drop out of the work force and lowered the de facto minimum wage $2. The $2 on an $8 wage is 25% for $4,000 a year. The victim is typically a Grandmother that has to work at the local donut shop to make ends meet - losing 25% of her income to the government over and above normal taxes.

 

 If the three main cities were allowed to come to Calgary's level of employment some 424,000 fewer people would be making less than $12 an hour. The annual heist this represents is $848 millions per year.

 

Red Deer is quoted above because it is the only city in North America to come to full employment since the 1970's. It's slightly ahead of Calgary and the rest of Alberta in terms of the number of people in the work force.

 

A main problem with a tight labour market is wage inflation. Here's the comparative inflation numbers of the tight Albertan cities with the depressed main cities. Inflation in a tight labour market remains thee major problem.

 

...........Montreal...Toronto....Vancouver.................Calgary...Edmonton

2006.........2.4%.........1.5%............6.7%.............................9.7%.........4.8%

2007.........0.9%..........3.1%...........2.2%.............................7.1%.........9.8%