Employers worried new $12 minimum wage will hit their businesses hard

While Quebec plans to implement the highest boost to its minimum wage in the province's history, small business owners say they're worried about whether they can absorb the upcoming hike.

"Probably, instead of hiring the necessary new people, maybe we will have to reduce staff to absorb the increase," said Ly Bunthan, owner of Dlices St-Jean in Quebec City.

Bunthan said theminimum wage has been going up for years, as have hisexpenses and tax bills. The province announced Wednesday thatminimum wage will rise to $12 in Quebec on May 1.

Monique Dion works at a bakery across the street. She says she makes only slightly more than minimum wage.

She told CBCNews she's happy about the nearly seven-per-cent increase, but said she's worried it may hit employers too hard.

"Many have told me that if it increases like that, they won't be able to pay their employees," Dion said.

She said many businesses in the area have gone under in recent years, which she believes is a product of tax increases and the rise of online shopping. A hike in the minimum wage, she said, may be the final nail in the coffin.

Ontario's minimum wage jumped$2.40 an hour as of Jan. 1, bringing the minimum wage to $14 per hour. In 2019, it will rise to $15 an hour.

Some businesses, such as Tim Horton's, reacted by cutting employee benefits and paid breaks.

Quebec Finance Minister Carlos Leito said the province's increase is "relatively moderate" and won't cause business owners to react in the same way.

"What they don't like is surprises,all of the sudden, 'Poof!' it goes up too quick," said Leito.

"Businesses, what they want most of all, is to have a predictable path for the minimum wage so they know every year what they can expect."

The CSN, one of the province's largest labour federations, welcomed the increase but said it doesn't go far enough.

At $12 per hour, Quebecers who make the minimum wage will still have a hard time making ends meet,Jacques Letourneau, CSN president, said in a statement.