A standard methodology for calculating living wages in the province

We’re excited to report we have launched the Alberta Living Wage Network, along with new living wages for municipalities across the province for 2021. This is the first time we have calculated all Alberta living wages using a single methodology. This allows living wages to be meaningfully compared between different municipalities across Alberta, reflecting real differences in costs or standards between communities, rather than methodological differences. This provides consistency for employers, particularly those that operate in multiple communities, when developing their own compensation policies.

So, how do we calculate the living wage?

Well, it’s complicated, but in most municipalities it really boils down the income needs of a two-parent family with two young children. It considers the hourly rate of pay needed for a household to maintain a modest standard of living, once government transfers have been added to the family’s income, and taxes have been subtracted. The methodology assumes that both parents are working full-time hours (35 hours per week) and includes more than the basics of food, clothing and shelter. Calculations also take into account unexpected costs, small investments in education, and childcare. In municipalities where the living wage is equal to the minimum wage for a family of four, a second calculation for a single person was done and the weighted average of the two was used to calculate the living wage. For more information, check out detailed calculations by municipality.  

Living wages have a goal to give people a modest standard of living, but the budget is basic and doesn’t provide for a lot of extras. It does, however, aim to get people and families out of financial stress by lifting them out of poverty and providing a basic level of economic security.

For the most part, living wage calculations were based on Statistics Canada’s Market Basket Measure which develops thresholds of poverty based on the cost of clothing, shelter, transportation, and other items for individuals and families representing a modest, basic standard of living. We used different metrics for food, childcare, health care and tuition. To learn more about the methodology, check out How Living Wages are Calculated.

How do employers get certified as living wage employers?

Along with launching the network, we are also formally kicking off our employer certification program, providing tools, resources and recognition to Alberta businesses wishing to become living wage employers. If you want to learn more or start the process to getting certified, check out Become a Living Wage Employer.