Many people’s image of a minimum wage worker is a teenager, perhaps at a fast food restaurant, earning some money to buy the latest smart phone. And a teenager flipping burgers is an accurate part of the picture: in 2011, almost 60 percent of minimum wage workers in Ontario were between 15 and 24 years of age.
Some of them are likely earning pocket money for extras; others are likely making crucial contributions to their family’s incomes and survival. But, we also need to look at the rest of the picture: minimum wage is not just a youth issue.
A rising share of the Ontario workforce is working for minimum wage. Between 2003 and 2011, the share of employees working for minimum wage has more than doubled from 4.3 to 9 per cent. Minimum wage work is not distributed equally across all Ontarians: women, racialized workers and recent immigrants are more likely to be working for minimum wage.
In 2011, the share of racialized employees at minimum wage is 40 per cent higher than for the total population — 13.2 as compared to 9 per cent. Fully 19.1 per cent of recent immigrants are working at minimum wage, more than twice that of all employees.
Young workers are much more likely to be working for minimum wage than those who are over 25. But almost 40 per cent of employees working for minimum wage, 183,000 Ontarians, were 25 years of age and over in 2011. The share of adult employees at minimum wage more than doubled between 2003 and 2011. However, the pace of increase was even faster for racialized adult employees and adult employees who are immigrants.
When we look at the distribution of low wage workers we see that twice as many employees in Ontario are making between $10.25 and $14.25 an hour — almost a million Ontarians. We see the shifting age distribution of low-wage employees when you move above minimum wage.
While 40 per cent of minimum wage employees are 25 years of age and over, that number increases when you include those making up to $14.25 — up to 61 per cent. The Ontario government is looking to an advisory panel for advice on setting the minimum wage. It is important that the panel keep these adult workers front and centre when they are considering their advice to the Minister of Labour. As should the province as they develop the next poverty reduction strategy.
An increase in the minimum wage will raise the floor for all Ontario employees. This increase will have a positive impact on those working for minimum wage and other low wage workers. It could also transfer income from shareholders to employees. The combined impact would reduce income inequality. In a time when governments feel that their budgets are constrained, this is a policy approach to address and reduce income inequality that is crucial and timely.
Read the report from the Wellesley Institute here.
Photo: wikipedia commons
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