Some living wages are going down? How can that be?
Even though the cost of living is rising, temporary government benefits impacted our calculation this year.
Last week the final living wages were calculated and to the surprise of many, the wages were a lot lower than many expected. “But how can that be?” they asked. Well, there was a complication. We based the calculations on real data that is mostly from last year; what happened last year? Amidst the affordability crisis, both the Provincial and Federal governments created temporary affordability payments.
Temporary measures that influenced the calculation using Drayton Valley’s calculation as an example:
Federal Grocery Rebate - the lone parent got $314, and the single individual got $234.
Alberta Affordability Payments: the family of four got $1,200 and the lone parent got $600.
Alberta Fuel Tax Relief Program: the family of four got $166; the lone parent; and the single individual got $111.
Here’s the dilemma. Using temporary benefits to calculate living wages skew averages down and because they are temporary, the living wages may have an even more dramatic jump next year. The problem is that government policy is important in keeping costs down and temporary benefits while not ideal in our calculation, helped many people.
For the Living Wage Network to truly reflect actual costs, we need to factor in everything that came into play during the year. However, a smaller-than-expected living wage increase was the outcome and four municipalities’ living wages went down this year. We know this is not the reality for low-wage workers who live in these communities.
We made a decision to forge ahead with including the temporary benefits in this year’s calculation. We hope that governments across the country see the benefit that these payments had on lower-wage workers and take steps towards more long-term income-based solutions like the Canada Child Benefit, which was increased by 6.3% in 2023. This meant about $600 more per year for a family of four and about $370 more for the lone parent in our calculations. The Canada Dental Benefit was another great example of a policy change that had downward pressure on living wages.
It's all about giving people what they need to ensure our community is vibrant and no one is left behind. Whether it’s a Disability Benefit that is above the poverty line, an income floor for people who are un or underemployed, or living wages.
2023 Living Wage Numbers will be released on November 8, 2023.