Living wage in Whitehorse could rise sharply next year, says public policy researcher

The living wage in Whitehorse could increase dramatically next year if governments don't take more actions to support people with low incomes, says author of a new report.

Kendall Hammond, a public policy researcher, wrote the latest annual living wage report on Whitehorse, which was released on Monday, for the Yukon Anti-Poverty Coalition.

The report found that the city's living wage went down in 2021 compared to 2020. But Hammond said the report doesn't take this year's inflation into account, meaning the living wage will likely shoot back up.

"We would expect to see a substantial increase next year in the living wage rate," said Hammond.

In 2021, the wage, which is based on expenses as they were in December 2021, decreased to $18.28 an hour from $20.95 the previous year.

A living wage is the hourly rate of pay two adults with two kids need to each make to meet their basic needs after taking into account government transfers like the GST credit and the Canada Child Benefit, and deductions like income taxes and CPP premiums. It is intended to provide a standard of living that is above subsistence living and allow for some social inclusion. 

"It includes things like shelter, food, clothing, transportation, child care and money for health expenditures when emergencies come up or a trip to the dentist and things like that," explained Hammond.

The dramatic drop in 2021's wage is "a result of the introduction of universal low fee child care in the territory," said Hammond.

In July 2021, the Yukon government signed an agreement with the federal government to create an average $10 a day child care option to children under age six. Hammond said the measure in the Yukon translated into a saving of nearly $10,000 for families with children.

But he says not everyone qualifies for those programs.

"Single people and people without children, like they're not receiving these kinds of support. And then we are seeing dramatic and escalating increases in particularly the cost of shelter over the last year, rising dramatically."

For both years, Yukon's minimum wage, currently $15.70, has been less than the living wage.

Gov't action could mitigate inflation, author says

Meanwhile, inflation across the country has been on the rise in 2022.

Canada's annual inflation rate hit 7.7 per cent in May, according to Statistics Canada's latest report. The Bank of Canada said it expects the rate to top eight per cent as early as next week.

Gas prices rose 48 per cent in the last year while grocery bills increased by 9.7 per cent.

Hammond said government action could help mitigate that increase.

"We need investments to help bring down the cost of essential goods and services, particularly housing," he said.

He added increasing government transfers to low income people would help.

Hammond said Whitehorse has one of the highest living wages in the country, nearly comparable to Vancouver and Toronto, and with its territorial neighbour Yellowknife leading the country.