Wynne's losing strategy

When Kathleen Wynne first announced plans to hike Ontario’s minimum wage to $15-an-hour, she argued the increase was necessary to create “fair workplaces and better jobs.”

[...] In Ontario, it was clearly politically profitable ahead of an election campaign for Wynne to champion millions of low-wage workers struggling to make ends meet, and paint Doug Ford –- then her chief rival –- as an enemy of the working poor.

That worked out well for the Liberals.

After Wynne hiked the minimum wage 21% in Jan 2017 (from $11.60-an-hour to $14-an-hour) employers — particularly smaller ones on tight profit margins — reacted by cutting jobs, cutting hours, cutting benefits, increasing automation and/or raising prices.

That's the insidious nature of minimum wage. Some of the very poor workers lose their jobs and they have great trouble finding work in an environment where many other employers are also cutting hours or firing workers.

What does help low-income families, Fraser suggests, are subsidies and cash transfers. Employers don’t care if employees pay less tax and get subsidies. They don’t react by cutting jobs, or hours or investment.