The minimum wage hasn’t risen since 1975, and young people are hit hardest

Proportion of employees paid minimum wage grows according to new StatsCan report

“Organic” was as much a grocery store and coffee-shop buzzword in the 1970s as it is today, and there’s another thing that workers in those businesses from 40 years ago have in common with their present-day counterparts: wages. Canada’s minimum wage hasn’t risen in real terms since 1975, according to Statistics Canada.

In a finding that will be little surprise to high-schoolers looking for a part-time gig or college and university graduates seeking a first permanent position, StatsCan says young employees are most likely to be paid the minimum wage:

Chart showing proportion of Canadian youth 15–24 paid minimum wage

Minimum wage levels are set by the provinces, and Ontario’s decision to raise its baseline requirement to $11 an hour earlier this year sparked significant debate about the economic impact on workers and employers. Mike Moffat suggested that a careful balancing act is required:

So what is the goal of the minimum wage? It appears to be to ensure there is a minimum dollar figure attached to someone’s hourly labour, though with a raft of unpaid internships in Ontario that are jobs in disguise, we should question how effectively we are meeting even that modest goal. However, as long as there is not significant job loss or reduction in economic growth, there does not appear to be a great deal of harm in having a higher minimum wage even if the benefits are relatively modest.

READ: Here’s what a truly fair minimum wage would look like »

More and more businesses are paying the lowest rate possible, according to StatsCan: the proportion of all paid employees earning the minimum wage in 2013 was 6.7%, up from 5.0% in 1997. Saskatchewan is the latest jurisdiction to announce a baseline hike, a paltry ¢20 raise that brings the province up to a barely-average $10.20.

Stagnant wage growth isn’t just a problem for those at the bottom of the salary scales: middle-class family incomes are slightly lower now than they were in the 1970s.

READ: Roundtable: Middle class wage growth and how to fix it »

Well-paid, secure jobs seem to be proving increasingly elusive for most Canadian millennials, and an unpaid internship coupled with minimum wage work is the growing standard. Last month the left-leaning Broadbent Institute called for a Youth Employment Guarantee to try and fix the problem of chronic underemployment.

Canada’s labour market isn’t as broken as we’re being led to believe, according to Stephen Gordon, and that’s particularly true of youth:

Youth unemployment is actually pretty low by historical standards; the only time it was lower was during the boom years just before the recession. On the other hand, employment rates are still low. This is the same thing as saying that youth participation rates have fallen. It’s not immediately obvious whether that’s a bad thing. If young people are going back to school and/or topping up their skills in formal training programs, a lower participation rate now may mean good things for the future.

READ: Canada’s labour market is closer to ‘normal’ than you think »

Still, Gen-Yers will take little comfort in knowing they’re making as much today as their 1970s counterparts. At least we’ve managed to get rid of the bell-bottoms and disco.