by Alex Sangha,  BSW (UBC), MSc (London School of Economics)
Registered Social Worker

Should the B.C. government increase the minimum wage or introduce a guaranteed annual income?

If the minimum wage increased from $6 or $8 per hour to $10 per hour then this would significantly increase labour costs for employers.

Small business owners would especially feel the pinch as they don’t have the same cash flow as a Wal-Mart or McDonald’s.

Small business is the engine that drives the economy and it is essential that this sector stay as healthy and as thriving as possible.

An increase in the minimum wage may force many employers to lay off workers or cut hours.

They may have to raise prices which may reduce the demand for their products which in turn would force them to lay off more workers.

An increase in the minimum wage would remove the competitive labour advantage B.C. has over other provinces in Canada.

Many displaced workers would most likely turn to welfare or Employment Insurance while they look for jobs that are becoming even more scarcer.

This government would have to increase spending to pay for these social programs while the economy adjusts to the new minimum wage rate.

So, what about a guaranteed annual income?

The infrastructure to turn this idea into a reality is already in place with the Canada Revenue Agency already issuing HST and other credits.

Anyone who’s income falls below a certain threshold can receive a guaranteed monthly payment.

We have seen how the Canada Pension Plan and Old Age Security payments have lifted many seniors out of dire poverty.

A guaranteed annual income can do the same for the poor and working poor.

There is no reason why the poor should have to go to welfare offices during times of financial need.

They can apply for a guaranteed annual income through an online application or with telephone assistance.

This will greatly increase the accessibility and efficiency of the program.

A guaranteed annual income will inject money into the economy during a time of a recession.

The money would go to the most needy among us.

It may help alleviate British Columbia’s high child poverty rate.

A guaranteed annual income will encourage spending.

This is good for small business and all business.

It may increase the demand for their goods and services.

This in turn may lead to the hiring of more workers and less people will have to be on welfare and Employment Insurance.

The citizens, government, and business all benefit with a guaranteed annual income.

It is a winning situation for the people and the province.

Sincerely,

Alex Sangha, BSW (UBC), MSc (London School of Economics)
Registered Social Worker