Ontario restaurant menus see impact from recent wage increase

By HUB SmartCoverage Team on February 28th, 2018

Notice anything different on the bill from your favourite local restaurant?

Apparently, food prices in Ontario rose 1.9% over the last month, which coincides with the increase in both server’s minimum wage and minimum wage overall that became law as of January 1st, 2018.

The wage increase has been a subject of debate since it began to be put forward in legislative meetings. Large restaurant chains and small ones alike explain that the increase will put a strain on their bottom lines. To make up for the labour costs, many restaurants have raised their prices.

This kind of jump in wages has not been seen for nearly 30 years in Ontario. The legislation made the minimum wage “increase more than 20 per cent at the start of this year to $14 an hour.”

Bloomberg News explains that this jump in prices was the largest since 1991, “when then Prime Minister Brian Mulroney introduced a federal goods and services tax, which drove restaurant prices up 7.2 per cent, the biggest one month gain on record.”

Inflation grew alongside the new wage hike in Ontario, which has analysts calling the impact on restaurant menus a “predictable response.” Ontario saw inflation increase in other sectors as well, including child-care and housekeeping services.

The fact is that labour, perhaps deemed as menial or cheap, is going to cost more and more as we progress into the future. These workers are contributing to local and provincial societies on an hourly basis and deserve to be paid fairly, especially as the cost of living basically competes with them in urban environments.

The Ontario government is promoting a living wage for workers with the wage increase, workers that had to work two to three jobs at a time to make ends meet. Results from CIBC’s annual financial confidence survey revealed that this wage increase has led to increased financial optimism for Canadians aged 18 to 34. 

And if consumers are upset that they have to pay 1.9% more for their meals, then they can and should eat at home.

Minimum-wage employees are being told they are worth more by the province which is positive; Ontario is becoming increasingly attractive to workers, which will only bolster economic growth in the province as we move forward. Let’s not forget that minimum wage workers are doing the jobs that a lot of people would rather not do.

Another wage increase is slated for next January, where the minimum will increase from $14 to $15 per hour.

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