WINNIPEG — While some minimum wage-earning Manitoba residents may be excitedly anticipating thicker wallets, restaurateurs are worried about today’s announcement of a 50-cent minimum wage increase that, according to the Canadian Restaurant and Foodservices Association (CRFA), could amount to nearly $16 million a year in extra labour costs.
“A mandated wage hike couldn’t come at a worse time for Manitoba’s restaurants, the vast majority of which are operated by small, independent business people,” Courtney Hirota, vice-president for the CRFA, said. “Yet another wage increase of this magnitude will end up hurting the very people it is intended to help, because many employers will have no choice but to control their costs by cutting hours or even jobs.”
The wage hike will guarantee Manitoba workers $9.50 an hour. “This increase will help maintain the spending power of approximately 28,000 people working in minimum-wage jobs,” Jennifer Howard, the province’s Immigration and Labour minister, was quoted as saying by the CBC. “The improved wage will give them a fairer income while helping Manitoba businesses recruit and retain workers.”
CRFA representatives have suggested income tax reductions to salvage the funds of minimum wage workers. Fortunately for the restaurant industry, some tax cuts are coming courtesy of the elimination of the Small Business Tax. That said Hirota is still concerned that the tax break will be cancelled out by increased labour costs.
Minimum wage increases like the current one are not unusual. According the CBC, wages have risen steadily from $6 onwards since 1999.
The wage hike is expected to take effect in October.
