Calculating Sudbury’s living wage

Posted on June 26, 2016 in Debates – News/Local/Accent
June 25, 2016.   By Ben Leeson

A wage of $16.18 per hour allows people here to meet annual expenses for a family of four to live a ‘healthy and socially inclusive life’

John Dickson considers himself to be one of the lucky ones.

The Sudbury taxi driver says he’s one of few drivers in the city who receive an hourly minimum wage, $11.25 in Ontario as of last October. Dickson has to be careful enough to manage his money, so he sympathizes with those raising families on low incomes or working in precarious jobs.

“My rent is low, but it’s lucky,” Dickson said. “If my rent was $1,000 a month like it is a lot of places in Sudbury, then I would be struggling.

“My rent is only $600 a month, so it’s not too bad, but there are places that are a lot more expensive and if I was raising a family and all that, then minimum wage wouldn’t be enough.

“I’m not struggling, but I know of a lot of people who are.”

According to a report released by the Social Planning Council of Sudbury last fall, parents working full-time must make an hourly wage of $16.18 to support a family of four.

That figure, called a living wage, reflects what earners in a family must bring home based on the actual costs of living in a specific community, calculated as an hourly rate at which households can meet their basic needs.

“In Canada, there’s a standard tool for calculating living wage in an urban context,” said Joseph LeBlanc, executive director at the Social Planning Council. “There’s a living wage network of which we’re a part, so collecting the data itself is a balance between having a community advisory group puts these templates into a local context. We struck that committee over the summer, people worked through the calculations and they advised on whether the amount for public transit is appropriate for Sudbury in particular, there was a bit of a modification made for personal transportation, in that our system for public transit system for the city as a whole is not ideal, the outlying areas, and things were changed to meet that need.”

“We landed very much in the middle ground in Ontario at $16.18 an hour.”

Living wages for other Ontario cities range from Grey-Bruce and Brantford, at $14.77 and $14.85 respectively, to the Niagara Region at $17.47 and Toronto at $18.52.

A living wage of $16.18 per hour allows Greater Sudburians to meet annual expenses for a family of four to live a “healthy and socially inclusive life in Sudbury,” according to the report.

Those include food, pegged at $8,144.76 using the Sudbury and District Health Unit Nutritious Food Basket as a guide; clothing and footwear, at $1,844.01; rent for a three-bedroom apartment, at $12,708; vehicle and transportation, at $6,817.6; recreation and family monthly outings, at $2,458.04; laundry, at $1,613.02; parent education, $1,225.74; along with various other expenses, totalling $65,301.24.

According to the SPC report, the same family needs to earn $66,513.53 annually, after government transfers such as child care subsidies and deductions such as tax, CPP and EI contributions, to “meet the bare minimum costs of living in Sudbury.”

“The reason why we undertook this project is we’re very much interested in economic security and in whatever way that’s expressed,” LeBlanc said. “We have participated in advocacy to increase social assistance rates, for example, or looking at solutions like guaranteed annual income, higher minimum wages and concepts like the living wage.

“Generally, it’s about the well-being of the population as a whole and income security is one of those social determinants of health, that impacts on the individual’s well-being, the family and the community as a whole.”

With a grant from the Atkinson Foundation, the Social Planning Council and the Sudbury Workers Education and Advocacy Centre, which helped prepare the report, embarked on a campaign this spring to promote the living wage in Sudbury and enrol employers in the campaign.

The SPC has already enrolled as a living wage employer, so even students working summer jobs there make $16.18.

“It’s more getting onto the idea that the people who work for you are giving you the majority of their time, and the expectation in that exchange is that they should meet their needs outside of the office with that income,” LeBlanc said. “The concept that somebody will work multiple, precarious jobs really does lead to negative health and social incomes, and there are all sorts of ways that’s expressed.

“We were just at the Living Wage Ontario forum (in May), and they had employers talk and people share lessons, like when your employer became a living wage employer, what that meant for your life. People were saying they quit their second job, that they spent more time with their kids – all these things that in the long run, if your interest as an employer is investing in these individuals, to build a sense of responsibility to each other, I think this is one of the ways to go.”

Jenny Fortin, executive director for the Sudbury Workers Education and Advocacy Centre, said the living wage has positive benefits for employees and employers, as well as the wider community.

“For workers, they actually receive fair compensation for their work and it helps to lift them out of poverty, because right now, the current $11.25 minimum wage keeps people about 10 per cent below the poverty line,” Fortin said. “Offering them a living wage offers them a better quality of life, therefore they’re able to afford better health care, better foods, and to have increased opportunities for education and skill development, as well.

“It has tons of benefits for the employers, which is really what we’re trying to pitch with the living wage campaign – things like reduced absenteeism, and a lot of people now want to support ethical businesses, so by becoming a living wage employer, it really gets them recognized as a responsible employer within the community and gives them that lift up. It also lowers recruitment and training costs, increased morale, productivity and loyalty, as well.

“A lot of employers assume that paying a higher wage will increase costs, but it helps reduce costs, because you don’t have that turnover that you normally have with the lower- and minimum-wage-paying jobs.”

Both LeBlanc and Fortin are optimistic that businesses and organizations in the city will enrol as living wage employers, but they know many companies operate on a business model that includes paying several employees minimum or student wages, and would not view the living wage as feasible.

Greater Sudbury Chamber of Commerce, along with its provincial counterpart, has called for restraint when it comes to government-mandated increases to minimum wage. The chamber prefers minimum wage be tied to the Consumer Price Index, a measure that examines weighted average prices of consumer goods and services, including transportation, food and medical care.

“It allows employers to have that heads up to know when changes are coming and for employees, to know with CPI we have the ability to have that gradual increase and that makes it transparent,” said Karen Hourtovenko, chair of the Greater Sudbury Chamber.

“We don’t have a stance on living wage. That’s not where we come from. We come from the voice of community business as a whole and from our standpoint, we look at what would a sudden increase of that nature cause, what would be the potential ripple effect, what would be the downsides from a business standpoint? With retail, hospitality and leisure sectors being hit hard recently with the economic downturn, as well as industries and mining, et cetera, what would happen if we were to have an increase that significant? What would happen to the bottom line of companies and how would that have a trickle-down effect?

“Would that increase cause a potential layoff in jobs? We don’t know what an employer would do, but would that happen? Or, if it wasn’t to happen, where would that extra cost come from, if their bottom line was already on shaky ground because of our economic status presently in Ontario? Would it go back to the consumer and how would the consumer feel about that? We have to look at it from that standpoint, from the business standpoint.”

Employers already face a cumulative burden, she said, from having the highest WSIB rates in Canada, increasing electricity prices and other business taxes and regulations.

“Would this be that tipping point effect for companies? Would that be the extra reason to say, ‘We may have to close our doors,’ or would it stop them from employing new employees? Would it support getting rid of or terminating positions? We don’t know that, but we have the be mindful of what could something of this level do from a business and economic standpoint in our community, as well as out province.”

LeBlanc said while there is evidence to support a minimum-wage increase to $15, a campaign the Social Planning Council and the Sudbury Workers Education and Advocacy Centre both support, it’s important to recognize the difference between minimum wage, which is set by the government, and living wage, which calls on employers to voluntarily set a higher standard.

“In general, minimum wage is far behind what would be considered necessary to support a living, but I do recognize that’s the baseline, so from there, there are huge implications to the economy,” LeBlanc said. “If you’re going to raise all income, then theoretically, costs will increase, which would make something like the livable income also increase, so I think tying this to that is difficult.”

He pointed out, however, that the City of Hamilton and its chamber of commerce have become living-wage organizations, which now pay employees $15 per hour.

“That means the people cutting grass in parks and all these summer jobs that city employers would have,” LeBlanc said. “Sudbury has a very high unemployment rate (8.7 per cent in May) and, though it’s diversifying, limited opportunities for youth, so I think institutional partners and players within the city have a role to consider what their opportunities do provide to others, to the youth in our community.

“We’re a very small employer, we’ll have five or six summer staff, but over 10 years, that’s 50 or 60 youth that will have experienced a decent wage in their hometown and do something meaningful for their hometown. Similarly, I would think the hospital, the health unit, the city, the publicly-funded institutions would at least take a look and this and consider the impact their employment opportunities have on people.”

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