Implementation of living wage policy leads to fewer jobs, hours, less training: Report

But supporters claim it’s a tool that can help people climb out of poverty
By Sarah Dobson
|Canadian HR Reporter|Last Updated: 02/10/2014

In 2011, the City of New Westminster in British Columbia became the first — and only — Canadian city to adopt a living wage ordinance.

Under the ordinance, all firms that are contracted directly or subcontracted by the city to provide services on city premises must pay employees who perform the services a living wage — an hourly amount to cover basic expenses. The figure for 2013 for the lower mainland is $19.62 per hour, assuming no benefits are provided by the employer.

But this may not be the best approach, according to a report from the Fraser Institute, a research and educational organization, which said employers respond to living wage policies by cutting back on jobs, hours and on-the-job training. They also end up hiring more qualified workers at the expense of those with fewer skills in order to offset some of the higher wage costs.