Skip to Content

Fraser Institute forecasts that increase in BC's minimum wage to $10.25 could cost 52,000 jobs

Jurisdiction: - British Columbia

The Fraser Institute released a report today in which it has forecasted that the hike in BC's minimum wage to $10.25/hour could lead to a loss of more than 52,000 jobs.

The increase in BC's minimum wage, that was announced by Premier Christy Clark soon after she took office, will occur in stages over time. The first increase from $8.00 to $10.25 is to take effect this Sunday (May 1, 2011).

The think-tank's report can be accessed here: Estimating the Economic Impact of British Columbia's Minimum Wage Increase (April 29, 2011).

The press release accompanying the report states:

  • The study examines existing academic research from Canada and around the
    world measuring the effects of increases to minimum wages, and finds the overwhelming consensus is that increasing the minimum wage has a significant, negative impact on employment, particularly for younger workers.
  • Based on the Canadian research, the authors calculate that an increase in B.C.'s minimum wage to $10.25 per hour from $8 per hour will result in job losses ranging from 9,391 jobs to 52,194 jobs.
  • The report notes that a gradual increase in the minimum wage-in B.C.'s case, three 75-cent increases over next year-will do little to ease the burden on employers or prevent job losses.
  • In addition to job losses and reduced hours, the report points out that higher minimum wages have other negative effects, including fewer benefits and less training for workers. 
  • The evidence from Canada also suggests that minimum wage hikes do not reduce poverty. A study published in Labour Economics earlier this year tracked increases in provincial minimum wages from 1981 to 2004 and found that a 10.0 per cent increase in the minimum wage caused poverty rates to climb by 4.0 to 6.0 per cent.