TORONTO, May 30, 2017 – Today’s announcement of a $15/hr minimum wage, combined with other costly changes to Employment Standards, betrays the trust of Ontario’s business community — including the more than 37,000 restaurants, bars and other foodservice establishments that employ nearly 473,000 Ontarians, from Pickle Lake to Kingsville.

“Just three short years ago, the Premier committed to a balanced, predictable model to set minimum wage rates,” says James Rilett, Ontario Vice President with Restaurants Canada. “Business took her at her word and supported the changes. Little did we know that she would turn around and make a backroom deal with union leaders.”

Ontario’s minimum wage is jumping by an astronomical 22.8% in January 2018, which is 10 times the rate of inflation. The total increase by January 2019 will be 31.6% in just 18 months – a total hit of $1.8 billion to the province’s restaurant industry.

DO THE MATH

  • The average restaurant owner in Ontario has 10 employees and annual revenues of $689,000
  • They earn a pre-tax profit of 3.4% (the lowest of any Canadian province), or $23,450 per year
  • A 31.6% wage hike will cost $47,000 per year, more than wiping out their profits

Source: Statistics Canada and Restaurants Canada

“Today’s announcement is devastating to the thousands of small business owners who hire and train high school students, newcomers to Ontario and others looking for a first start in the labour market,” says Rilett. “There is no question this will lead to fewer jobs, fewer hours, and fewer employers.”

“The government says it wants to get kids out of their parents’ basements, but today’s announcement will have the opposite effect. We’re going to see more young people living in their parents’ basements longer.”

Restaurants Canada is a growing community of 30,000 foodservice businesses, including restaurants, bars, caterers, institutions and suppliers. We connect our members from coast to coast, through services, research and advocacy for a strong and vibrant restaurant industry.

6 comments

6 responses to “Wynne government plays politics with youth jobs”

  1. Richard says:

    This sudden change in minimum wage is a train wreck waiting to happen. Created by politicians trying to buy votes .Prices will likely rise, which will push some customers out of the market, or increase costs to any customer that chooses to continue to frequent restaurants It will create job loss and the closure of many restaurants. The Canadian banks should also be fighting this change as they will bear the brunt of these bankruptcies. Many of these are small business loans that are guaranteed by the government so all taxpayers lose. This train wreck will touch all parts of the business including suppliers to those restaurants.

  2. Ellen Sandler says:

    I totally agree with the above. This is so inflationary. It is a rippling affect. All small businesses will have to increase pricing to absorb this increase resulting in not only labour costs going up but food costs, supplies, etc. All small business will be affected by higher costs not only restaurants. You are creating a world that will no longer recognize service as being important and the use of technology taking over for jobs. Jobs for young people are so important to build self esteem, independence and good social skills. Our young people only communicate with text. This is going to get worse over time. This will result in higher unemployment, less money for the government, more people collecting ei. What is the point. Increase minimum wage gradually not in one big chunk. I will not vote liberal ever!!!!!!!!!!!

  3. We currently employ 30 ppl at our full serve restaurant. This wage increase will add up to a $156,000.00 in the first year and about $80,000.00 the second year. As a restaurant that make everything from scratch so we can provide better food for our customers and train young employees how to cook from scratch and in return teaching them a trade. This will change with the changes to the new wages. We estimate to layoff at least 7-10 people and start buying most of our food directly from the food supplier already portioned, chopped, peeled and frozen. Sadly enough most customers will not understand the price increase on the menu. Servers have enjoyed a good tip percentage between 15-25 percent. We are sure customers will start leaving less since their menu items will rise and their check average will go up. It has been working out with the current system with a small increase yearly. This is too much and too fast at once. Liberals have lost my vote forever.

  4. John Baxter says:

    HOW STUPID ARE WE
    The Provincial Liberals are proposing changes to Ontario’s workplace that will have a devastating effect on our economy and way of life. The Fair Workplace Better Jobs Act 2017 is going to cost the citizens of this province far beyond any benefits that Ms. Wynn is trying to sell you or votes that she is trying to buy with your money.

    If you believe that a 30% increase in the minimum wage is not going to cost you at the gas pumps, the pizza store, the grocery stores, your favourite fast food outlet etc. etc. etc. you are sadly mistaken. When your wage goes up $3.50 per hour, the employee already making $15.00 per hour will rightly want to move up to $18.50 per hour. This cycle will continue throughout the labour market. Don’t forget that your employer has to match you paycheque pension deductions (dollar for dollar), your EI Deductions (1.4 times your paycheque deduction) and based on a gross payroll, payment to WSIB. These changes proposed by the Liberals also increase your paid vacation from 2 weeks to 3 weeks. These will increase your employer’s overall cost by an additional 2% on the gross payroll.

    Where Does This Take Us???

    Your next Meal Deal: Burger, Fries and a Coke ….. only $12.00+tax
    Your next Pizza…. Large Pizza only $19.95+tax
    Your next Quart of Milk….$5.95
    You make more money your income taxes will increase, your home taxes will increase.
    All your living expenses will increase.

    Who Wins or Who Wynns

    If the Gross Domestic Product (GDP) of Ontario is, say $650,000 million dollars, and because of the increase costs introduced by the Provincial Liberals, this figure rises to about $800,000 million dollars. The Ontario Provincial Sales Tax is currently at 8%. Easy math, the Government of Ontario will increase it’s cash flow by $12 million dollars.

    In Ontario, there are 13,600,000 citizens. If the Government can generate for it’s own treasury .01 per person, per day, the Liberals will increase their cash flow by approximately $50 million dollars. “How Stupid are We”, this proposed law is NOT a good deal for anyone except the Liberal Government.

  5. Paul says:

    If you need some support contacting your MPP, please feel free to get in touch. pmckay@restaurantscanada.org. Be happy to confirm the name and contact info for you and help even provide a draft message if you like. This is a really tough issue given how it has been positioned and everyone will need to make their voice and vote heard.

  6. Ian Wallace says:

    My restaurant is in the range of the numbers listed above and I totally agree that this would be devastating to my already tight bottom line. This increase will add $52,753 in wages, payroll taxes and WSIB to my restaurant. We are already being squeezed with increased hydro rates and it is becoming harder and harder to stay in business.

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