A 47% minimum wage increase under the NDP administration to $15 an hour was responsible for up to 26,000 job losses, according to a recently released report.. Young workers .The document — dated Feb. 26, 2020 but only released on March 17, 2023 — details findings by a minimum wage expert panel into the increase from $10.20 to the current level..According to the report, the wage hike led to “sharp increases in labour costs at a time when businesses were most poorly positioned to do so ”during a time where Alberta was “struggling with a massive economic downturn.”.Younger workers (15-24) bore the brunt of the job losses, with the shift away from inflation-based minimum wage increases leading to the number of Albertans on minimum wage rising 9.2 percentage points to 11.5%..Using a synthetic control technique, the panel estimated total job losses between 23,000-26,000 from 2015-18 due to this shift in policy..Businesses outside Edmonton and Calgary were hit especially hard, with firms forced to take actions such as reducing the number of employees, reducing or eliminating plans to hire new or additional workers, reducing or eliminating plans to hire young workers, postponing renovation and expansion plans, and raising prices..Not only did the panel assess the raised minimum wage, it also investigated the liquor servers’ wage for employees in hospitality..“Because it lowered the amount of direct labour costs that restaurants had to incur for liquor servers, the liquor server wage gave restaurateurs flexibility to competitively compensate back-of-the-house staff and avoid increases in menu prices,” according to the report..“This enabled restaurants to make investments in enhancing the guest experience which, in turn, arguably helped liquor servers earn more in tips and realize higher overall earnings.”.“Survey and payroll data from businesses indicates the elimination of the liquor server wage likely led to reduced hours for liquor servers in Alberta. In turn, this resulted in liquor servers having less opportunity to earn tip income, negatively impacting their overall earnings.”.“When the liquor server wage was eliminated, restaurateurs lost the labour cost flexibility it had provided, leading them to layoff and reduce hours for front-of the house and back-of-the-house service staff. This put new pressures on liquor servers and may have impacted guest experiences, in turn resulting in lower tip income for liquor servers.”.“Based on the results of industry surveys, the vast majority of Alberta restaurants signal they'd increase shifts and hours for liquor servers if a liquor server wage was re-established in Alberta. In turn, this would mean liquor servers have more opportunities to earn tip income, which would then support them realizing higher overall earnings.”
