Increasing Minimum Wage Essay
“Increasing the minimum wage is a bad move economically, philosophically and politically.” This quote by Marc Freedman, a distinguished author and CEO of Encore Careers, perfectly exemplifies my view on minimum wage. As a minimum wage earner, I would enjoy and entertain the idea of a few extra dollars in my pocket that comes with a minimum wage increase. Despite my self-interest, I believe in the interest of Ontario and the general population, that a minimum wage increase has only negative implications. I believe a minimum wage freeze is necessary, the economy needs to catch up, to decrease minimum wage is very difficult for a government because they would never get elected.
In a time when Ontario is in a slow economic recovery and is in …show more content…
By increasing the minimum wage in Ontario, it will raise prices on goods and services and in turn negatively affect the economy. Here is an example: I am in the market for a vacuum cleaner. There is a Sears store in Toronto, and one in Buffalo, and they have identical products and number of employees. The Sears in Toronto has to pay their employees $10.25 or more plus benefits; therefore their products will cost more. If I can drive 2 hours and visit our neighbors to the south and get the same vacuum cleaner for $200 cheaper, why would I buy it in Toronto? In this example, increasing Ontario’s minimum wage encourages people to buy in New York where the sales tax will be paid. This negatively affects the Ontario economy because the government and the business do not get any revenue. If the minimum wage increases it will only increase the government’s deficit. If jobs are reduced because businesses cannot afford to pay their employees, then there will be a greater need for unemployment insurance/benefits which increase the government’s deficit even more. If businesses do not make a profit, they do not pay taxes, and if this continues year after year, the companies will simply relocate to a lower-cost location (lower wages and/or lower
In a time when Ontario is in a slow economic recovery and is in …show more content…
By increasing the minimum wage in Ontario, it will raise prices on goods and services and in turn negatively affect the economy. Here is an example: I am in the market for a vacuum cleaner. There is a Sears store in Toronto, and one in Buffalo, and they have identical products and number of employees. The Sears in Toronto has to pay their employees $10.25 or more plus benefits; therefore their products will cost more. If I can drive 2 hours and visit our neighbors to the south and get the same vacuum cleaner for $200 cheaper, why would I buy it in Toronto? In this example, increasing Ontario’s minimum wage encourages people to buy in New York where the sales tax will be paid. This negatively affects the Ontario economy because the government and the business do not get any revenue. If the minimum wage increases it will only increase the government’s deficit. If jobs are reduced because businesses cannot afford to pay their employees, then there will be a greater need for unemployment insurance/benefits which increase the government’s deficit even more. If businesses do not make a profit, they do not pay taxes, and if this continues year after year, the companies will simply relocate to a lower-cost location (lower wages and/or lower