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Employers react to increase

Wayne Scott, an em­ployee at Wallace Fam­ily Farm in Cascumpec, checks the fuses on the farm trac­tor he used to pull a potato har­vester dur­ing the fall har­vest. Scott said there is enough equip­ment to re­pair on the farm to keep him em­ployed all win­ter.

CASCUMPEC – Many Island employers bracing for an increase in minimum wage costs next year are resigned to the reality that wages are a necessary cost of doing business.

The Prince Edward Island Employment Standards Board has mandated a 60 cents-perhour increase to the basic minimum wage effective next April 1. The minimum hourly wage will move to $12.85 per hour, up from $12.25 as of April 1, 2019, $11.55 on April 1, 2018 and $11.25 on April 1, 2017.

The increase rarely effects just the minimum wage earners, suggested Anne Arsenault, general manager of Tignish Initiatives.

“There’s two sides to it. It’s difficult to live on minimum wage, but on the business side of things, it obviously adds more expense to the bottom line. It does contribute to hardship to the business side of things,” she stated.

“At some point when the margin gets squeezed too much, the business either has to go out of business or increase their prices, but it gets to a point where there is only so much that the market, or the consumers, are willing to pay, too.”

The Tourism Industry Association of P.E.I. (TIAPEI), in a recently issued news release, agreed there will be winners and losers.

“While we see this as good news for employees earning the basic minimum wage on P.E.I., we are very concerned about the effect this will have on small business owners,” expressed Kevin Mouflier, TIAPEI’s CEO.

Moufier said TIAPEI advocates that increases to the Basic Personal Tax Exemption would provide more relief to low income workers than increases to the minimum wage.

The association has also been advocating for a one year advance notice on such wage increase. Mouflier said many operators had already set their budgets for the 2020 tourism season.

Tammy Rix, executive director of the West Prince Chamber of Commerce, said her members have mixed reaction to the increase.

“Retail and food industry will be hit the hardest with smaller margins to work with,” she said, adding other small businesses that employ seasonal workers will have to adjust cost of services accordingly. .

Rix is also finding some positives for business in the increase. “Raising the minimum wage can actually help businesses reduce turnover, improve productivity and perhaps increase the chances of employees staying more content in a job longer.”

The P.E.I. Agriculture Sector Council maintains a listing of job openings in the farming sector, including some where minimum wage is indicated.

Laurie Loane, the council’s executive director, said they have no position on the wage increase, but agrees it is just one of the ever-increasing costs of doing business. She’s not seeing the increase having much of an impact on the current job shortage in the industry.