Voices of our Nation

The Pros and Cons of Minimum Wage

Canada’s minimum wage, the minimum hourly pay rate employers can pay their workers, varies across the ten provinces and the three territories.  Each Canadian province and territory has a distinct set of minimum wage laws specifying the minimum wage, exemptions to the minimum wage, and other labor law issues. However, the debate continues concerning whether a minimum wage is beneficial for the countries that have implemented various minimum wage requirements.

In several countries, there is a discussion regarding the pros and cons of minimum wage. The initial minimum wage law was enacted in New Zealand.  The first Canadian minimum wage legislation was passed in 1918 by both British Columbia and Manitoba.  Among the many minimum wage arguments, leaders have expressed concern over encouraging outsourcing, ensuring workers can make a living, keeping market prices low, interfering with natural supply and demand, and the ability of new workers to gain adequate experience.  Each of these minimum wage issues have presented varying affects on the economy, the gross domestic product of individual countries, and regional job growth.

Supporters of minimum wage laws often suggest that there are labor abuses and concerns over living wages. Advocates for an increase in minimum wage say it will lift workers out of poverty and stimulate the economy.  Proponents of a minimum wage propose that a decent minimum wage would be a significant incentive for employees to be productive which creates a more efficient workplace. Workers must make enough to support themselves and their families. If left unchecked, businesses and corporations might take advantage of unskilled laborers as well as immigrants. These workers typically only have enough skills to qualify them for minimum wage positions, leaving them vulnerable to businesses that capitalize on a lack of government regulation.

Opponents of a minimum wage typically contend that there is potential disadvantage of outsourcing work to lower-paying countries, job growth statistics based on supply and demand, new workers, and the effects of wages on prices.  Minium wages could erode the effectiveness workplaces when unskilled, cheaper labor is hired instead of the more skilled laborers. Those people opposed to raising theminimum wage are concerned that  higher minimum wages are not only ineffective, but actually do more harm than good for the very working poor they aim to help.  According to opponents, countries with high minimum wages cannot compete with other nations on price, owing to the increased cost of production. As a result, these countries often outsource low-paying work to other countries with lower wage standards, taking jobs and tax revenues away from the local economy.

This article was contributed by volunteer blogger Shan Simpson.

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