Hike in Minimum Wage Rate Is It a Right step?
The hike in minimum wage rate in the B.C. Province is questioned by the economists, as they are in doubt that this new policy might lead to rise in unemployment rates.
The economists doubt the steps taken by the B.C. province government of increasing minimum wage rate for the entry level workers.
They fear that, as a reciprocation action the unemployment rate will increase simultaneously. They are of view that it may adversely affect the province by leaving young people unemployed.
Niels Veldhuis from the Fraser Institute commented on the situation, that this policy will act as a blunt one it will tend to increase unemployment rates for youth population from 15 and 24 age group because businesses will hire only few people at the entry levels. They may also go in for reducing work hours and various benefits given to the trainees during this period. According to Veldhuis the government should reconsider their decision otherwise they may have to repent.
He further supported the view of various studies of Canada, according to which whenever any province had raised its minimum wage rate have faced high rate of unemployment amongst the young age groups.
According to the statistics around 2.2 per cent of the province working population earns their share through minimum wage, other seems to experienced and so are paid in better terms by their employers. Hence, the inexperienced young ones only are paid minimum wages, whose number now might lessen down due to new policy introduced.
The new wage rate introduced in the province will increase to $10.25 to an hour from $8.00 per hour previously. As per the policy it will increase in three steps 75 cents in every six months, once now then in November and then again in next May. This step has been taken as minimum wage rate has not been increased in the province since 10 years and was the lowest in Canada.
Christy Clark says, “The step taken of hiking the minimum wage rate and removing the training wage rate is totally justified as in we are taking care of the families first and then moving towards building our economy,” while announcing the minimum wage rate increase.
Jim Sinclair, President of B.C. Federation of Labor, welcomes the change and says, “The government should have increased the minimum wage rate in one go only rather than in three steps,” he also commented that there are less chances that due to hike in wage businesses will hire few people, as businesses are not charity and are there to earn, so if they are in need of people they will hire them at new wage rate even hike won’t affect it.