Minimum wage: Canadian cities unlikely to mimic L.A., Chicago hikes

Los Angeles has become the latest U.S. city promising to raise its minimum wage, but a city-specific approach would be unlikely to work in Canada for reasons both practical and political.

L.A.'s city council recentlygave initial approval to a plan that would hike the minimum wage to $15 an hour by 2020, in a decisionits supporters saywill help families in a city with some of the most expensive realestate in the U.S.

Otherlarge U.S. cities that have increased thehourly minimum wage within their borders include Seattle($15), San Francisco ($15) and Chicago ($13).

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With callsfor a $15 minimum wage in B.C.and a $14 rate inOntario,could a city-specific approach work in large cities like Vancouver or Toronto?

Sheila Block, a senior economistwith the Canadian Centre for Policy Alternatives' Ontario, told CBC News thatcity-specific wages couldwork, given that a city like Toronto has the population of several provinces.

Provinces already tweak their minimum wages for certain jobs. For instance, Ontario has a different minimum wage forliquor servers, students under 18, homeworkers and hunting and fishing guides, while B.C. has different rates forliquor servers, live-in support workers, live-incamp leaders and crop harvesters.

'A number of difficulties'

"I think it's an idea that has some potential," said Block."I also think there are a number of difficulties associated with it."

Blockwrote a paper in 2013 that showed about 150,000 minimum-wage workers in Ontario are between 25 and 54, which she saysundermines the argumentthat advocates for a higherminimum-wageare "teenagers looking to buy the newest smartphone." The same paper showed thatvisible minorities and immigrants who have been here 10 years orless were more likely to be on minimum wage, she said.

Those numbers suggest that diversecities like Toronto and Vancouverwould be an especially good fit for theirown minimum-wage rates, when considered along withtheir status asthe two most expensive Canadian cities for real estate.

But any change would be metwith pitfallsbig and small.

For one, Block said, governmentswould needto ensure that geographic minimum-wage rates couldonly be raised, not lowered, lest cities compete with each other for the lowest pay rates.

Second, a city that raisesits minimum wage would needto be largeenough to have an infrastructure that couldenforce its ownrules. "If yourrights aren't enforced, they don't have much muscle or teeth," she said.

Third, businesses would be likely to balk at such a change, Block said. And while that would have little effect on service sector jobs like those at Starbucks, it might result in, say, a wholesale processing centre moving just over Toronto's borders into a city like Vaughan.

Block said there's only been the beginnings of conversations about city-specific minimum wages in Canada, unlike the major municipalmoves south of the border.

Block said that's partially because it's less necessary in Canada. Unions face stronger resistance in the U.S.,and American workers are forced to turn to cities because they have no traction elsewhere, she said.

By comparison, lobbying for higher wagescontinues in B.C. and Ontario, whileAlberta's new NDP government has promised a $15 minimum wage.

"I don't think we've exhausted the options we have at the provincial level I'd go there before Itriedto do that municipally," she said.

'I don'tsee those handcuffs loosening'

There's anotherkey difference between the U.S. and Canada that makes city minimum wages unlikely north of the border. Canada has a completely different division of powers from the U.S., where both mayors and cities are more powerful than their Canadian counterparts.

In Canada, labour laws are almost exclusively a provincial responsibility.

Nelson Wiseman, the director of the Canadian Studies Program at the University of Toronto, said the only reason people even make the comparison is because the two countries are side by side.

"Why don't we compare it toMumbai? We're living in different worlds jurisdictionally," he said.

Provincial governments aren't likely togive up their jurisdictional powers, he said, especially if it means favouring one area over another.

For instance, infrastructure needs are probably most pressing in Toronto, but governments go out of their way to say money will be distributed to all communities.

"In the U.S. cities can impose tolls. I'm reading in today'spaperthat Toronto can't impose tolls on itsown roads[without provincial approval].That tellsyou how they're handcuffed, and I don't see those handcuffs loosening."

He suspects supporters would saya higher minimum wage is needed in a place with a higher cost of living, while detractors would say an increase would artificially pump up the cost of living.

But he believes the conversation about city-specific minimum wagesis moot.

"My angle is more institutional," he said. "It's not going to happen."