Press release on minimum wage

PRESS RELEASE 25 February 2020 - The newly-announce minimum Yukon wage for the coming year of $13.71 brings us perilously close to an economic danger zone identified a January 13, 2020 economic impact study undertaken by the Yukon Government at the request of the Yukon Chamber and it’s five associated municipal chambers. The study identified a “danger zone”; where the minimum wage reaches 45-50% of the average hourly wage, and that range lies between $14 and $15.50 per hour. Additionally, the study cited that as of 2018, there were only 408 workers earning minimum wage, and that the majority of those earning minimum wage are in school and/or living with their parents. The Yukon business community, comprised disproportionately of small businesses, have always been supporters of efforts to reduce poverty in the territory. However, as stated in the January 13 study, “the minimum wage is at best a crude anti-poverty measure.” Later in the report, it states that “…the minimum wage redistributes income from a narrow subset of society, minimum wage employers, rather than spreading is across the tax base. The increased payroll cost for minimum wage employers is far greater than the benefit to poor people.” Yukon Chamber of Commerce Chair, Tammy Beese observed, “what this study also does not appear to address is the economic impact on employer costs of all the tiers of workers currently earning above minimum wage. Employers tell us that minimum wage increases beyond the mandated cost of living increases have the impact of pushing upward all successive tiers of hourly wages.” YCC President Peter Turner added, “in the province or territory with the lowest unemployment in Canada, the vast majority of Yukon employers are already offering entry level salaries several dollars per hour above the currently minimum wage; and, particularly in communities outside of Whitehorse, employers are increasingly having to offer additional benefits such as meals and/or accommodation (both of which further impact a businesses’ bottom line) to attract employees, so an increase of this magnitude is extremely concerning. The Yukon minimum wage already has an annual cost of living adjustment, an element not included in most provinces; no differentiated minimum wage for tip earners, as is the case in many provinces, and even before this new $13.71 minimum wage rate, the Yukon was solidly in the middle of the range of provincial and territorial minimum wages.” This increase takes us close to the edge of the “danger zone” identified in the January 13 study, as which point further minimum wage increases beyond the annual cost of living adjustment will resulting in: Potentially damaging economic impacts, particularly to Yukon small businesses that comprise 90+% of our employers, many of whom are currently paying well above minimum wage, forcing them to bear the upwards pressure on subsequent tiers of employee wages not accounted for in the January 13 economic impact study; • Reduced hours, lower employment for existing workers; and • Implementation of “a crude anti-poverty measure” projected to have nominal impact for a very few Yukoners. The Yukon Chamber of Commerce is deeply concerned that further increases invite the risk of reduced employee and business hours, lower employment, and further incentive to introduce automation and customer self-service wherever possible. This is not a desirable direction for the Yukon private sector, their employees, or the customers they service. Incorporated in 1985, the Yukon Chamber of Commerce is the collective voice of Yukon's business community, working to create a climate conducive to a strong private-sector economy by providing leadership and representation on issues and projects affecting business. The Chamber works with over 750 Yukon businesses, through either direct or Community Chamber membership, as well as the five Community Chambers of Dawson City, Silver Trail, St. Elias, Watson Lake and Whitehorse.