Minimum wage hike hurting small biz

By Geoff Lee

October 6, 2016 12:00 AM

Amanda Anderson, owner of Pure N Simple Market, said she can't afford to hire a full time employee with the minimum wage now up $1 to $12.20 an hour and rising to $15 an hour in 2018. She, and other Lloyd businesses, said they believe the timing's just not right for such an increase.

Lloyd business owners say timing isn't right for such a raise

Alberta’s latest minimum wage hike of $1 a hour isn’t getting much of a welcome from small businesses in Lloydminster.
Your Dollar Store With More for instance, doesn’t like the timing of the minimum wage hike from $11.20 to $12.20 an hour that came into effect on Oct. 1 with the province’s economy still reeling from oil and gas layoffs.
“I don’t think it was necessary right now because we’re already having enough trouble as it is,” said Kelsey Scott, a bookkeeper at the Dollar Store owned by her dad, Kevin Eger.
“There are less people out there that have money to spend so it’s already tough, plus we ran into an issue in Lloydminster alone with three other stores coming in competition-wise.”
Scott said the wage hike is another expense the store can do without in the current economic environment.
The $1 an hour increase is the second in a series of progressive steps that will give Alberta a $15 per hour minimum wage by 2018.
Approximately 300,000 individuals in Alberta earn less than $15 an hour today.
Scott said at this point it’s hard to say what the impact will be by 2018 knowing most of her full time employees are already above that pay level.
The general provincial minimum wage will rise again by $1.40 to $13.60 per hour on Oct. 1, 2017.
Scott said in Lloyd you have to pay your good employees more to retain them, but there is a limit.
“I don’ t have a lot of flex room to give them much more than that because we are a small business,” she said.
“We are independently owned, so it’s not like I can go and hand out $5 raises to everybody—it’s unfortunate.”
Ward Read, CEO of Lloydminster Economic Development Corporation suggests the wage hike will have more impact on businesses now than when the economy was firing on all cylinders.
“At that point in time, our market minimum wage was probably closer to $15 already,” said Read.
“This change will likely impact more businesses now than it would in the past.”
Along with the $1 an hour wage hike, the lower liquor server rate of $10.70 per hour is also eliminated.
For consumers, Read says the wage cost increase might be passed on to the consumer and might impact the staffing levels that businesses maintain.
“They might not be able to keep the same number of staff or potentially, the higher wage rate will enable them to retain higher quality staff to maintain better service levels,” he said.
“It’s something we will just have to wait and see how the total impact plays out.”
He said a $15 an hour wage in 2018 would be more difficult for the small- to medium-size businesses that
rely more on casual or part time staff or have a smaller employee base.
“So when the cost increases for them, the impact to them is potentially much larger than it would for a multi national firm,” said Read.
Amanda Anderson, owner of Pure N Simple Market said even the old minimum wage of $11.20 an hour made hiring one full time employee too much of a financial burden.
“I would love to have me and two other people here, but I can’t afford it,” she said, noting she has one part timer and family members who help out.
She too said she thinks the timing of the wage hike is not in sync with the economy, especially for small businesses that are already cutting costs to the bone.
“Nobody’s going to be able to afford it unless you are a big fat chain that brings in thousands of customers a day,” said Anderson.
Anderson said she’s stayed afloat and grown by reinventing her business to a niche market and cafe offering gluten free food and meals along with organic produce boxes.
She’s also added cooking classes, food catering and preparing hot lunches for schools to counter the affects of the downturn and business overhead.
“I still can’t hire an employee full time,” said Anderson.
“I hardly even pay myself anything because I don’t want to be taking out money that could be used for an emergency.”

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