Minimum wage debate rages on in P.E.I.

The debate over a planned increase to P.E.I.'s minimum wage next year continued today with two new groups joining the fray.

The provincial government announced last week it plans to increase the minimum wage to $10.75 from $10.50 an hour on June 1, 2016, and to $11 on Oct. 1.

The announcement prompted protests from the restaurant industry and the Greater Charlottetown Chamber of Commerce, who argued the increase will hurt business.

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• Minimum wage increases bad for business: Chamber of Commerce

Today, the Tourism Industry Association of P.E.I. added its voice to the opposition.

CEO Kevin Mouflier said the association recognizes that Islanders need a livable wage, but it's concerned about how the increases will impact members.

"It's concerning for the industry considering that since 2005, the minimum wage has increased over 60 per cent. We are concerned in the fact that it is affecting businesses," said Mouflier.

"Again, at the end of the day, with the cost of energy and the cost of wages being one of the highest, this is something that does affect businesses in the long run." 

Mouflier said 85 per cent of tourism businesses are small, seasonal operators with fewer than 10 employees, where wages account for 30 to 35 per cent of total operating costs.

The hit to revenues and rising employment costs mean some businesses will consider closing, while others might delay or cancel plans for improvements or expansions, he said.

Mouflier said lower income Islanders would benefit more from higher personal tax exemption rates at the provincial level.

'A way to bring people up'

NDP Leader Mike Redmond, meanwhile, rejects the notion that a higher minimum wage will hurt business.

Redmond cited a report from the Canadian Centre for Policy Alternatives that looked at 30 years of data from every province including P.E.I. and concluded increases in the minimum wage very rarely had an impact on job numbers.

But the report found that when the minimum wage did affect job numbers, it was almost as likely to create more jobs as make jobs disappear.

"We think if you give more people money and if people have more money to spend, especially locally, they're going to spend it on buying groceries, they're going to spend it in restaurants and going to the movies, and buying essentials at the store and heat and oil and those things," Redmond said.

"So really we need to look at minimum wage as a way to bring people up and give everyone a certain standard of living."

When the minimum wage on P.E.I. hits $11 an hour, it will be the highest in Atlantic Canada.

New Brunswick has promised to reach $11 an hour by 2017, and Nova Scotia — which increases its minimum wage each year with inflation — will hit around $11 by 2017.