Ontario Minimum Wage

Ontario Minimum Wage
Name of Student
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Introduction
The economic problem described in the paper is the hiking of the threshold wage for the workers by the government in installments. The least wage is supposed to be hiked up to $15 per hour. The increase in the wage is a motivating factor for the employees but the economic factors should be considered in case the remuneration is to be increased by any percentage (Lee 2012). This paper criticises the hiking of the minimum wage.
The firm in context has committed to raising the minimum wage for its workers but as an economist, the step is not feasible. The minimum wage for the workers is set by analysis of several factors in the region and the micro-environment in which the worker is delivering the services. The theory which best suits the discussion is the economic theory of minimum wage. The theory argues that the least wage payable to workers is proportional to the monetary impacts of the government policies and federal regulations. The minimum wage affects the income of the nation and its citizens (Lee 2012). The least payable wage should be able to maintain the standard of living of the citizens and minimize the national debts. The minimum wage should have more positive effects than the negative impacts.
The body
The Ontario’s firm should not raise the wages for the workers as the government requested. The current minimum wage for the workers is $11.40. The wage is supposed to be hiked up to $15.

The increase is $3.6 per hour. In terms of the percentage, the increase is 31.6%. The increase in the base pay will lead to the retrenchment of 50,000 labourers. This shows that there will be massive losses of the jobs. From the statistics, the unemployment rate is 5.7 percent. The recent job creation was 30,000 jobs.
From the data provided, it can be seen that the number of the low-income workers will increase from 520,000 to 1.6 million. This includes the teens and the adult workers. The level of the quality of life will increase for the low-income workers will increase at the expense of others losing the jobs. This is because the wage bill for the firm must increase thus dropping most of the low-income workers. From the statistics provided, the number of the workers that will lose the jobs is more than the vacancies which were created recently despite the fact that the unemployment ratio is low.
The increase in the wage by $3.6 per hour is not manageable for the time given. The firms need some time to adjust to the payroll increase. This limit the number of the workers who will lose the job. The low-income workers are the one to be mostly affected by the hike in the base pay (Neumark 2012). Most of the low-income workers are semi-skilled or not skilled. This shows that the likelihood of securing a job will take the time or will need to be trained to be considered for the skilled labor jobs. If the base wage is to be hiked, the amount of the working hours per week should also be increased in the same ratio to maximize the productivity of the workers.
Conclusion
From the description given above, I advise the Ontario firm not to hike the base pay of the workers otherwise they have to sack a lot of workers to balance the payroll. The minimum wage bill should be proportional to the economic growth of the nation. The quality of life of the workers can be raised by granting non-interest loans to the low-income workers instead of increasing the base pay.
References
Lee, D., & Saez, E. (2012). Optimal minimum wage policy in competitive labor markets. Journal of Public Economics, 96(9-10), 739-749.
Neumark, D., Salas, J. I., & Wascher, W. (2014). Revisiting the Minimum Wage—Employment Debate: Throwing Out the Baby with the Bathwater?. ILR Review, 67(3_suppl), 608-648.