Manitoba's Minimum Wage Needs to Provide a Living Wage:
submission to the Minimum Wage Board
- Spring 1999
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What is UNPAC (Mb)?
The UN Platform for Action Committee or UNPAC (MB) is a Canadian organization, formed following the Beyond Beijing: Call to Action Conference in Winnipeg in the Spring of 1996. It is an association dedicated to seeking equality for women through the implementation of the Platform for Action - the document agreed to by Canada, and with representation by the Province of Manitoba, at the UN Fourth World Conference on Women in Beijing, China in 1995.

Along with the approximately 40 Manitoba women and men who went to Beijing, many more supported the objectives of the Conference and have worked together to support public awareness activities since the conference. UNPAC supports these objectives by working through community action, and with other organizations, locally and globally, for equality, development and peace.

We feel the issue that is before you has a particular impact on women in this province and wish to speak about it today. In fact one of the commitments by Canada following the Beijing Conference was to complete gender analysis on proposed government programs and policies. With respect to change to the Minimum Wage, that would most certainly result in an increase to a living wage. As well, one of the twelve Critical Areas of Concern in the Platform for Action is Poverty, and specifically the PFA states that governments will:

"Review, adopt and maintain macroeconomic policies and development strategies that address the needs and efforts of women in poverty"

In fact, even as only half the general population, women are a powerful force in the economic and social dynamics impacting on society as a whole.

Canada's federal and provincial governments are being challenged by a United Nations committee to determine if "Canada is compliance with the UN's International Covenant of Economic, Social, and Cultural rights.....Child Poverty is at a 17-year high of 20.9 percent...After the last recession ended in 1991, poverty rates have risen steadily since then."¹

We urge you to take into considerations the commitments made at the Beijing Conference.

Regarding general demographics:
Given that 62.1% of the 16,000 employees earning minimum wage are women, ( and 61.1 % of the 30,300 near-minimum wage earners earning $5.41- $6.00/hr);²

Given that 51.5% of these 16,000 employees are 20 years of age and over and 59.4% of the 30,300 near-minimum-wage earners earning $5.41- $6.00/hr are 20 years of age or older);³

Given that 26.0% of them are heads of households ( while 30.4% of the 30,300 near-minimum wage earners earning $5.41- $6.00/hr are heads of households);⁴

Given that 42% of the 16,000 employees earning minimum wage are working full-time (and 46.9% of the 30,300 employees earning near-minimum wage $5.41-$6.00/hr are working full-time);⁵

Given that the proportion of citizens requesting food supplements from Winnipeg Harvest who are working has more than doubled from 10% to 25% over the past ten years;⁶

Given the high drop-out rate in Manitoba high schools;

Given the high rate of teen pregnancies in Manitoba (four per day), combined with the fact that 95% of these choose to parent their child/children;

Given that Manitoba Family Services attributes 55% of its social assistance expenditures on sole support parents, to adolescent parents or those who first became parents as teen-agers. In 1995/96, they spent $71 million to support those who became single parents as teenagers;⁷

Given the serious literacy challenge in this province;

Given the high numbers of immigrants attempting to integrate into this city/ this province despite their struggles with English as a second language;

Given the social revolution of aboriginal citizens leaving their traditional lifestyle of hunting and fishing on the reserves for life in urban centres;

Given that the ratio of retired citizens to workers is projected to be ten to one, there is an urgency to plan to mobilize and train a viable workforce now;

Regarding Rural Issues:
Given the financial strain on the family farm owners and their need to subsidize their agricultural operations with salaried income;

Given the limited job opportunities in the rural areas and the transportation challenges i.e. the cost of vehicles and the considerable travelling expenses going to and from home and the workplace;

Given the higher cost of living in the rural areas due to extra transportation costs added to the cost of merchandise purchased locally;

Regarding Students and Issues Relating to Training Costs:
Given that post-secondary education tuition fees have increades dramatically over the past few years - for example, at the University of Manitoba, tuition fees for one-year courseload in Arts have increased 185% from 1985-86 to school year 1996-97 ( from $877 to $2499);⁸

Given that the average student debt load has increased from $9,000 to $25,000 from 1990 to 1998 ( a 178% increase); ⁹

Given that, whereas only about 8% of the students had a debt load of $25,000 in the early 1990's, approximately 40% of the students are affected by this kind of debt-load in 1998; ¹⁰

Given that there is a firm policy from the Income Security Departments at all levels to exert pressure on recipients of social assistance to go out and find employment, regardless of their educational background, family circumstances, or skills;

Given that there are few training opportunities and corresponding funding in terms of grants and bursaries, for the non-elite to access post-secondary education; Given that Manitoba has abandoned its grant program in favour of a loans program and the Manitoba Student Assistance program, (originally set at $40.00/per week and subsequently decreased dramatically by 18% in 1995);

Given that Manitoba has the highest rate of child poverty in Canada;

The members of UNPAC recommend that Manitoba develop a comprehensive anti-poverty strategy which includes a strong minimum wage policy which protects all workers in Manitoba, including agricultural workers and domestic labourers who work 24 hours or less for the same employer as well as workers who are employed by independent contractors.

Furthermore, we would like to elaborate on the following issues:

1. There is a premise that the marketplace, unencumbered by government regulations, will find competitive prices for goods and services for the benefit of all citizens. Many business owners, ideally, would like to have all business taxes dismissed, all wages de-regulated, all governmental regulations abolished, in order to have a free hand to increase profits as they see fit,(example MAI). They would like to see production increase, which could result in hiring a few more employees to meet the demand. This is supposed to improve the economic vitality of a community/society.

   We would propose, however, that if the wages are kept very low, that the workers do not have enough money to buy the coveted items or services.

   They may not bring home enough to cover basic living expenses. One could argue that the employees are subsidizing this business's profits or losses. If a company counts on having its employees subsidize the operations, without any further return on this investment, we contend that the business plan is inappropriate, unacceptable, and therefore not viable. It, therefore, should not exist. If the product or service is too pertinent to the community's well-being to be abandoned, perhaps, some other financial backing should be secured.
   
   

2. We, at UNPAC, are also very concerned about a perception or belief that the poor are solely responsible for their situation, independently from government and social policies.

   We would like to challenge this belief. We acknowledge that while there are many factors which *create/maintain poverty, the minimum wage being only one of many, yet, it is one whose importance cannot be overstated.

   The minimum wage is meant to be the entry-level wage which is the threshold, the ground floor of wages to anyone starting out in the workforce. Regardless whether the employee is a student living at home, beginning his/her first paid position, or whether he or she is entering the job-market as a lone parent earner when the children are in day-care, the minimum wage is the same. Quite understandably, it is not up to the employer to subsidize the employee's family responsibilities. It is quite clear that there needs to be an economic safety net** to support the low-income wage earners in their responsibility to provide food, shelter and clothing to meet the needs of their growing family members.

   It is, however, the employer's responsibility to provide training and supervision which assist the new worker gain new skills to warrant fair and timely raises as employment progresses such that there is an incentive to maintain or develop a level of motivation about one's work, hope about one's future, and perhaps even a sense of loyalty to the employer. The minimum wage, let it be restated, is meant to be an entry-level wage.

   Business owners need to plan for fair and timely raises as part of their business plans.
   
   

3. The portrait of the family has changed dramatically over the past decade. Marriages break up rate has risen to 50%. Considering all of the energy, pain and stress related to family break- down, it is important for the governments to understand how this may impact the policies they develop. We can no longer assume that two-parent families can manage to support their children through college or other post-secondary education. Many young people do not dare to dream to pursue post-secondary education.

   It is low-income families who are bearing the brunt of the devolution of powers from the federal to the provincial governments. It is Health, Education, but especially the social safety net that has been dramatically eroded over the past few years as the Banks and the multi-nationals boast of ever-increasing profits. Here is an opportunity to begin to rectify regressive policies.
   
   

4. "Manitoba spends approximately 1,4 million dollars per day , $ 1000 dollars per minute, on high-risk children and youth." ¹¹

   As a matter of fact, poverty is a major issue affecting the health and well-being of its citizens and of the larger community. There is an undeniable correlation between physical and mental health and the degree of poverty/wealth in a society.¹² Children from poor families are less likely to benefit from the necessary nutrition to promote learning. The ensuing lack of academic success affects the child's/youth's self-esteem and sense of belonging. This often translates itself in anti- social behaviours, anti-authority attitudes which sets the scene for gang-involvement, dropping out of school and/or dropping out of life(i.e. suicide/addictions).

   Aside from the social and emotional cost paid by families and society in general from the increase in crime and fear and insecurity, there are serious monetary costs that are paid by every tax-payer in the form of increased public debt and insurance costs.

   Taxes increase to cover escalating costs for mounting policing costs, judicial costs, holding costs, i.e. penitentiaries, foster homes, treatment facilities, etc. Acting out behaviours such as the abuse of alcohol and other drugs, as well as sexual irresponsibility which result in sexually transmitted diseases and in unplanned pregnancies, further tax our society in terms of higher health costs and income security costs. The tremendous stress associated with high levels of poverty and the trapped feeling of no possible escape from one's circumstances, contributes to an increase in family violence including child abuse. Oftentimes, the discouragement of an earner working full-time but still never bringing home enough to meet even the family's basic needs, contributes to his or her "losing it" with those closest to him or her. Couples break up, children may be apprehended and the family is in crisis for a extended period of time.

   Employers and business owners need to take leadership and do their part to be responsible corporate citizens.

   Manitoba offers many great advantages. Low utilities rates, reasonable rental rates and real estate value, relatively low taxes, efficient transportation networks, as well as a multi-cultural workforce, are all important features this province has to offer a business to launch itself into the global marketplace. Employers and business owners who respect their workforce with a minimum wage which allows the employees to live with some level of dignity, will no doubt discover that they will save considerable money because of a decrease in absenteeism, staff turnover, and due to an increase in motivation, productivity, integrity and reliability.

   At this rate of earning, there is little or no discretionary money. There is not enough to stash away in RRSP's or RESP's for that matter. All of the income goes directly back into the economy in terms of shelter, food and clothing and taxes. Any increase in income at this level is still certain to be recirculated into the local economy.

• Let it be recommended that the Minimum Wage Board adopt a fair wage increase to be increased by increments over the next couple of years to bring it on par to 60% of the average wage;
• Let it be recommended that the minimum wage be indexed to the cost of living;
• Let it be recommended that there be a periodic review of the formula by which the minimum wage is established.

** Social Safety Net
The following are initiatives/services which are important in a society which is serious in its war against poverty and committed to a healthy vibrant society: Affordable /low-income housing; safe, stable and supportive neighbourhoods; community programs and outreach programs; accessible, affordable high-quality daycare; affordable public transportation; incentive-focused social assistance programs with transitional programs to employment; accessible, flexible educational programs, and corresponding financial and family support; low-interest loans to encourage entrepreneurship; health care; support /treatment programs for victims of violence; employee assistance programs; employment insurance programs that support people who are making an effort to work; guaranteed income supplement to ensure families have their basic needs met; progressive taxation policies ( proportionate to income versus universal taxes on goods and services) in support of families with children, to name some initiatives which counteract the poverty cycle.

Other References
The Canadian Fact Book on POVERTY (1994) by David Ross, E.Richard Shillington, Clarence Lockhead

Investing in Children: An Action Plan for Manitoba's Children and Youth, prepared by Manitoba Action Committee for Children and Youth.