Business owners warn wage hike could drive up prices

Some Red Deer business owners are still not convinced the timing is right to increase the province’s minimum wage.

Some Red Deer business owners are still not convinced the timing is right to increase the province’s minimum wage.

Next month the wage will increase to $12.20 from $11.20 before landing on a mandatory $15 per hour by Oct. 1, 2018.

“The longer this recession has been going on and the already increased costs local businesses are facing I think for some this is going to be the straw that breaks the camel’s back,” said Reg Warkentin, policy and advocacy manager for the Red Deer & District Chamber of Commerce.

Warkentin is concerned about the businesses with tight budgets. He said anybody in the hospitality industry such as restaurants or food processors will have problems.

“Generally, these are businesses that weren’t paying minimum wage. They were paying above minimum wage. By adding this cost, they’ll have no choice but to respond, which may mean fewer hours for employees, cut backs and the number of staff,” said Warkentin.

Kathryn Harris, a manager of Sunworks, agrees there may be that possibility, but she is confident the wage increase will be a positive thing.

“Personally, I think it’s great. A lot of people at minimum wage are struggling for the bare essentials which is really too bad. As a manager it’s something we are conscious of and we make sure all of our staff are taken care of,” said Harris.

Owners across the city are a little less convinced.

“It’s a good idea, but how can we increase the wage and not increase the price of food. People are suffering because there is no work and no money. It’s frustrating,” said Alex Charafeddine, owner of Red City Donair.

For Pardeep Takher, owner of Extreme Pita, the increase doesn’t make a lot of sense.

“The wage is going up, but everything else is going up as well. For people who are making minimum wage, it’s not really going to help them,” said Takher.

Alberta Premier Rachel Notley said on Tuesday that she doesn’t believe the hike in wage will create potential job losses or cut backs.

Warkentin just doesn’t buy it.

“It doesn’t make a lot of sense, it’s a one size fits all solution that just doesn’t work. I don’t get it,” said Warkentin.

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