Examining the impact of October’s minimum wage increase on the community of Sylvan Lake

Examining the impact of October’s minimum wage increases on the community of Sylvan Lake

Sylvan Lakers making minimum wage will see an increase on their pay stubs come October when the first round of minimum wage hikes take place.

Following a campaign promise made by Premier Rachel Notley minimum wage will rise from the current $10.20 to $15 by 2018.

On Oct. 1st the first round of hikes will take place bringing Alberta’s minimum wage from one of the lowest in the country to among the highest at $11.20, leaving Alberta settled in at third place behind Ontario’s $11.25 and Northwest Territories’ $12.50.

In addition to the raising of general minimum wage, the separate wage for liquor servers and waiters will also rise going from $9.20 to $10.70, with the notion of separate wages for those serving liquor gradually being phased out by 2018.

Over the past week Sylvan Lake News touched base with the Sylvan Lake Chamber of Commerce and local businesses to examine to the potential impacts of the minimum wage increases may have on the local economy.

Joel Johannson, vice president on the board of the Sylvan Lake Chamber of Commerce and general manager at Meadowlands Golf Club, stated he feels the biggest impact to his business will be visible with the number of employees he will be able to retain over the coming years.

Johannson said the majority of his employees during his busy months are high school students making minimum wage in entry level positions. He added this first round of raises in October will mean a few very happy teenagers will be getting raises.

“The $1 raise in minimum wage is going to mean we just gave all of the 15, 16, and 17 year olds on the golf course a raise whether they deserve it or not,” said Johannson adding a $15 minimum wage will mean an adjustment to the entire pay scale of his business. “If we are paying a 15 year old kid, with a learner’s permit and no experience other than cutting the grass in grandma and grandpa’s yard $15 an hour we can no longer continue paying our more skilled workers $15 an hour.

“When you talk about that kind of increase nearly 50 per cent over 2 years you’re really not just talking about the minimum wage earners, the whole pay scale then needs to go up, people we are currently paying $15 an hour who have been working here for several years we will now have to pay more.”

As vice president on the board of the Chamber, Johannson said he believes many business will turn to an increase in the prices of services to adjust to the higher wages for workers. However, in his line of work in the golf industry this isn’t an option.

“There is a ceiling to the price of golf people are only willing to pay a certain amount of money for golf, so price increases aren’t ideal in this industry,” he explained. “The government has put us as business operators in a particularly tricky situation, especially in a time when the economy has been quite slow due to the prices of oil,

“We have some tough decisions to make and ultimately it means we are going to have to try to deliver the same level of service with fewer people to help us do it.”

He added next summer the likely implications will be seen in his number of minimum wage workers employed, stating instead of 10 students hired he will only be able to have five or six.

Wes Huffman, owner of Pier 7 restaurant, stated his concerns do not necessarily stem from a business owning perspective rather his concerns are for his staff.

“There is some concern from my servers that they may not make as much in tips when that wage does hit the $15 mark,” explained Huffman. “Will people still tip when they know servers are making $15 an hour?”

Huffman added come 2018, the increase in staff’s wages could mean more than an additional $100,000 out of the average locally owned restaurant’s pocket.

“Most restaurants will likely have to adjust with slight price increases to compensate the higher wages,

“You can take a burger from $12 to $13 and likely no one will notice or say anything, but you can’t take it from $12 to $20 or else no one will eat at your restaurant, so owners are going to have to find other ways to cut expenses.”

This means for Huffman he will have to look very closely at where his money is going especially in the areas of advertising and his non-profit charity work. Where as in the past he was able to have the extra income to be able to give back to the community, this may need to be rolled back to account for wage increases and the desire not to drastically increase food prices.

“If restaurants across Alberta do decide to raise prices to adjust for the increase of wages then maybe we won’t see as many people going out to eat any more and that hurts servers also,” said Huffman. “Then not only are servers making less in tips because people know they are making $15 an hour, the restaurants will be slower also and servers will then make even less.”

editor@sylvanlakenews.com

 

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