Is a $15 Minimum Wage Good for Business?

The Ontario government came up with plans to completely sweep labor reforms. Shockingly the most controversial of plans was the idea of raising minimum wage to $15 an hour by January 2019.
There was an argument that following that plan could destroy many jobs of which more are profoundly needed, especially for the youths. While the counterargument was that the plan will boost the demand for the creativity of jobs.

#Enables growth drive

A 57 per cent of the Canadian GDP is being accounted for by household purchases, which is an increase in shares of economic activities ever since 2008, reason being that business investment, exports and shortages still haven’t impacted much.
House prices have been on an increase especially in large cities were majority of the population lives. This is consuming more disposable income and hindering the monthly budget necessary to make purchases from domestic and international producers.
When expensive households experience wage gains, a good chunk of it goes to savings with a good part of it leaking out of the economy. In contrast when households with low income experience an increase in incomes, they spend everything at one fell swoop. And all the spending stays within the local economy.

#Inspires productivity

Surprisingly 30 per cent of Ontario’s labor market which is the biggest in the country has employees working at low wages, earning less than $15 an hour in 2016.
Even though some workers probably lose their jobs after the increase in minimum wages, majority will receive a pay hike and eventually get back into the economy. Businesses will continue to rise as consumers increasingly spend and hence the urgency for more workers will rise to meet up with the rising demand of goods and services.
Most economists believe that increasing cost will eventually lead to increase in productivity which will benefit businesses.
According to Statistics Canada, Canada has long since been operating a low-wage economy for decades and even outsmarted the U.S. on low-wage work reliance.
Raising wages may be bad for some businesses and jobs, but the other enterprises that solely depend on low wage work will view a step up in productivity, little or no turnovers, reduced recruitment and training costs.
There is the need for change and a higher minimum wage will surely do the trick.