2005 data (pdf):
Percentage of employees who were paid minimum wage: 4.3
Percentage of minimum-wage workers who were
- working part-time: 59.2
- between 15 and 19 years old: 44.5
- students living at home: 33.2
- heads of a household with children under 18: 5.4
The Toronto Star, in its recent series on the 'working poor', offers as support for its call to increase the minimum wage the 'Questions by Experts' section of the UN Committee on Economic, Social and Cultural Rights' report on Canada:
On the minimum wage, it appeared that this did not allow for a decent standard of living, as it was below the amount needed to keep people above the poverty line, and this was contrary to the Covenant, and [the Expert] asked what would stop a country as wealthy as Canada from implementing a minimum wage that provided a decent standard of living.
I don't know what sort of expertise the The Expert is supposed to have, but the answer to his question is this: the minimum wage is a remarkably ineffective instrument for dealing with poverty. Labour demand curves slope downward in rich countries, too.
Update: A longer discussion of the effects of the minimum wage on employment and poverty is here.
You're famous! (Well sort of anyway. You've been linked to at reddit. Someone chose to complain there, but not here for some reason, that you didn't provide an alternative to the minimum wage to help poor people.
I don't know enough about Canada to comment, but in the US economists routinely prefer the Earned Income Tax Credit (EITC).
Posted by: happyjuggler0 | September 30, 2006 at 09:50 PM
The URL is a link to "Characteristics of Minimum Wage Workers" of the U.S.
About 1.5% of US workers work at or below the Federal minimum wage.
The big question in raising the minimum wage is its potential effects on unemployment, especially among minorities.
The August jobless rate for America's black teens (ages 16 to 19 years) compared with the over-all jobless rate for U.S. teenagers of 16.5 percent. Black teenagers are out of a job at more than twice the national rate for their age group.
Of course, this is nothing compared to the 50% unemployment rate for youth of African descent in France.
Posted by: Mr. Econotarian | September 30, 2006 at 10:32 PM
happyjuggler0: Wow - I just check my stats, and there's been an avalanche of hits from reddit.
For those of you who asked, the alternatives I would want to explore include:
- increasing the Child Tax Credit and/or the GST rebate
- an earned income tax credit (Quebec already has one)
- a Guaranteed Annual Income (my personal favourite)
Posted by: Stephen Gordon | October 01, 2006 at 07:37 AM