- What is the issue? People in Nova Scotia, Canada want to raise the minimum wage to $15 per hour because they do not earn enough money to make both ends meet.
- Why is this an issue? The wage of $10.70 is not enough for people from Nova Scotia to satisfy their primary needs in food and housing (CBC, 2016). It appears that an average price of a house in this province amounts to $228,000, which is not affordable for people working for small businesses, whereas the supplies bill is estimated to be around $186 a month for one person here. Therefore, a senior government official must consider raising wages paid to local people. Otherwise, their living conditions will be inappropriate, whereas the region might live in poverty.
- Background: To begin with, it is necessary to mention that Stephen McNeil (who occupies the position of a Nova Scotia Premier) declined the population’s request to raise their wage to $15 per hour (CBC, 2016). Local citizens decided to address this issue when they felt that the money they earn was not enough to cover all their monthly expenses. Instead, McNeil offered other privileges that would leave more finances in the pockets of Nova Scots. He said that a higher salary would lead to an inflation of prices in the region.
It is an interesting fact that people from the neighboring United States of America have also been requesting their government to raise their wages to $15 an hour. It appears that the prices have been rapidly increasing in both countries within the past several decades. It must be stated that every time in history when any changes in the Canadian population’s wages were made, national taxes changed accordingly.
It is estimated that Canadians received the highest payments for their work back in the 1960s (considering both their incomes and waste). Although the minimum wage amounted only to approximately $11, it was enough for an average citizen to afford their monthly food expenses and appropriate housing. Therefore, the issue described above became actual for the population of Nova Scotia when the prices in their region became higher. Nowadays, the level of unemployment in this state also increases because of the lack of financial means in the budget.
Analysis
As it is mentioned above, the main risks of raising the minimum wage in Nova Scotia are related to further inflation (CBC, 2016). Hence, people will not be able to afford more than they do at the present moment. Another risk is related to the decision of the Nova Scotia Premier, Stephen McNeil, to let people save more money in supermarkets and several other governmental institutions. The politician wanted the lower-income class to pay less for their utilities and several other regular expenses.
Some considerations also should be discussed in the given section to assess the issue from different perspectives. It is a well-known fact that teen employment also leads to a lack of budget finances paid to people occupying various minimum wage positions. The payment checks given to people in Canada started to decrease in the 1980s. Then, many scholars conducted multiple research to understand what factors influence people’s abilities to cover their monthly expenses with their low wages. As mentioned in the previous section, it was estimated that their wages were higher, even though they received less money. The wage of $7-8 an hour was enough for an average person because taxes, food, and housing prices were significantly lower. Considering the given issue, teenagers will not be able to work in summer anymore as all the finances will be precisely allocated among adults if the minimum wage in Nova Scotia increases up to $15.
Policy recommendation
A sound solution to the issue would be to raise the minimum wage in Nova Scotia up to $12-13 per hour. This change would not empty the budget of the province. In turn, people will be able to buy enough food to make both ends meet and will not have challenges with covering their housing expenses. Moreover, the suggestion made by McNeil (to make the lower-income class to pay less for their regular services) must also be incorporated. This would make people’s life much easier and there will be no need to raise taxes and prices in Nova Scotia.
Annex: Other options considered
There is another sound option that has to be considered to prevent the possibility of mass poverty in Nova Scotia. It would be proper for local people to quit their minimum wage jobs and start migrating to other countries to seek new opportunities. The demographical issue will make local politicians reconsider their views and raise the minimum wage.
Reference
CBC. (2016). $15 minimum wage would produce inflationary pressures, says the premier.