Media Advisory: Business lobby's "Economic Impact Study" on Bill 148 fails to address the reality that past minimum wage increases prove that jobs are not at risk, says OFL

TORONTO, ONTARIO--(Marketwired - Aug. 14, 2017) - The Ontario Federation of Labour is raising serious concern about the validity of the assertions in the Keep Ontario Working (KOW) coalition's commissioned economic impact analysis of Bill 148, conducted by the Canadian Centre for Economic Analysis (CANCEA).

"The assertions released today by the corporate lobby is inaccurate, incomplete and just not responsible," said Chris Buckley, President of the Ontario Federation of Labour.

This analysis fails to acknowledge the increases in consumer spending of higher incomes for low-wage Ontario workers, the reduced demand on social services and the strengthening of household financial stability that will result from a more equal distribution of income in Ontario. In other words, this report considers only the costs of a higher minimum wage, not the benefits.

"Every economist that we've consulted since the Fair Workplaces Better Jobs Act was announced points out that its measures will in fact strengthen Ontario's economy," said Buckley. "Many also note that areas for improvement still exist within the legislation."

"The pessimistic assertions in this report are at odds with the well-established conclusion in published, peer-reviewed economic research that changes in minimum wages have very small, if any, impacts on employment levels," said Jim Stanford, Harold Innis Industry Professor of Economics at McMaster University.

"Some low-wage employers may want to maintain a situation where employees have to work for poverty-level wages. But from the perspective of Ontario's overall economic success, it is these very pools of working poverty that are in fact holding our economy back," said Stanford. "The dire assertions in this report have not been validated or reviewed by other economists. Indeed, the consultants hired by the business lobby have not even explained how these forecasts were generated," Stanford added.

There is strong economic evidence that the provisions of Bill 148 that aim to raise incomes for low-wage workers and contribute to more better workplace rights for Ontarians will lead to a stronger and fairer economy.

"The self-serving scare tactics of certain corporate lobbyists and their consultants cannot refute the actual outcomes seen in those jurisdictions that have already made substantial increases in their minimum wage. The business lobby tried a similar tactic in BC and Alberta, and they were wrong there too," said Chris Buckley.

For example, when the Alberta government began to phase-in a $15 minimum wage in September 2016 and eliminate the sub-minimum wage rate for liquor servers, corporate lobbyists were quick to predict dire economic consequences, especially for the services sector.

However, those predictions failed to materialize. The Parkland Institute published this rebuke of the outrageous claims made by the business lobby in Alberta: " [The CFIB] made the bold prediction that the government of Alberta's $15 per hour pledge would cost the province "between 53,500 and 195,000 jobs." In other words, the CFIB believes that almost half of the 350,500 Alberta workers currently making less than $15 an hour could lose their jobs. This is simply not credible."

As it turned out, Alberta's Treasury Board and Finance Department reported that, despite the recession caused by the drop in oil prices: "The service-producing sector has seen consistent gains throughout the downturn, with employment now 37,800 higher than in June 2016.

"Today's announcement should be taken for what it's worth, a simple attempt by the employer and business lobby to whip up a frenzy about imagined hardships," said Buckley.

"Ontario's economy is growing relatively strongly right now, including creating 138,000 jobs in the last year alone. This is exactly the time for ambitious, forward-looking measures to ensure that this growth is shared more fairly," said Stanford.

Along with community partners the Fight for $15 and Fairness, the Ontario Federation of Labour has been calling for enhancements to Bill 148.

The OFL's Make It Fair campaign and the Fight for $15 and Fairness takes on issues of inequality in the workforce, and coincides with the province's "Changing Workplaces Review." The campaign calls for across-the-board changes to the Employment Standards Act and the Labour Relations Act that would improve standards for all workers and make it easier for them to join a union.

The OFL represents 54 unions and one million workers in Ontario. For more information, visit www.OFL.ca and follow @OFLabour on Facebook and Twitter.