MEDIA RELEASE - 185,000 Ontario Jobs at Risk from Bill 148: Independent Economic Impact Analysis
For Immediate Release
August 14, 2017
185,000 Ontario Jobs at Risk from Bill 148:
Independent Economic Impact Analysis
Bill 148 will increase the cost of consumer goods and services by $1,300 per household starting in 2018, according to new analysis by leading economics firm
TORONTO / SAULT STE. MARIE – Today, the Keep Ontario Working Coalition (KOW), in partnership with the Ontario Chamber of Commerce (OCC) and the Sault Ste. Marie Chamber of Commerce (SSMCOC), released the first and only independent economic impact analysis of Bill 148, the Fair Workplaces Better Jobs Act. Conducted by the Canadian Centre for Economic Analysis (CANCEA), the study revealed that if the legislation is implemented as currently drafted, there will be significant, sudden and sizable uncertainty for Ontario jobs, economy and communities.
The study concludes that these vast, unprecedented reforms will put about 185,000 jobs at risk in the first two years, greatly impacting Ontario’s most vulnerable workers.
“The changes presented in Bill 148 will have dramatic unintended consequences that include putting close to two hundred thousand jobs at risk, and seeing everyday consumer goods and services increase by thousands of dollars for each family in Ontario,” says Karl Baldauf, Vice President of Policy and Government Relations at the Ontario Chamber of Commerce and spokesperson for the Keep Ontario Working Coalition. “We’ve run the numbers and it’s clear that this is too much, too soon. If the Ontario government chooses to proceed with these sweeping reforms too quickly, all of us will be affected, and the most vulnerable in our society chief among them.”
Of particular concern to the Sault Ste. Marie Chamber of Commerce is the regional impact analysis included in the report. The report identifies Algoma as one of the regions with the highest number of jobs at risk as a result of the government’s proposed changes.
Rory Ring, CEO of the Sault Chamber notes that the Act will not affect all regions of the province equally. “Obviously there are certain sectors that are going to be impacted more substantially by the proposed changes. Today’s report confirms that sectors like retail trade, manufacturing, accommodations, food service and private sector health care and social services are going to be among some of the hardest hit, and as a result will face the greatest chances for significant job losses. Unfortunately, these are precisely the sectors that make up a large part of Sault Ste. Marie’s job market,” says Ring.
Ring points out that of the provincial regions assessed in the report, the Algoma region falls within the top 10 in respect to percentage of local jobs at risk as a result of Bill 148’s provisions. According to the report, almost 27% of all Algoma jobs could be at risk if all aspects of the legislation pass.
CANCEA was commissioned by the KOW coalition to measure the potential impacts of six key areas of change in Bill 148, including changes to minimum wages, “equal pay” provisions, vacation, scheduling, personal emergency leave (PEL) and unionization.
Data from the economic impact analysis shows:
$23 billion hit to business over the next two years alone
185,000 Ontario jobs will be at immediate risk over the next two years
30,000 of the jobs at risk are youth under 25
96,000 employees at risk are expected to be women
50 per cent increase to inflation for this year and the foreseeable future. The cost of everyday consumer goods and services will go up by $1,300 per household on average each and every year
The Ontario government would need to borrow $440 million more to cover the increases in new costs from this legislation. If the government were to provide offsets to businesses, as they have indicated, the province’s treasury will take a bigger hit
Municipalities will be forced to increase employee wages by $500 million without additional offsetting revenues
“Simple accounting reveals that the Act creates a $23 billion challenge for Ontario businesses over two years. Annualized, this is 21 per cent of what Ontario businesses invest in capital,” notes Paul Smetanin, President, CANCEA. “Given the significant, sudden and sizable changes it would be remiss to expect that unintended consequences would not follow.”
The report confirms the Sault Ste. Marie Chamber of Commerce’s concerns about the legislation’s impact on small businesses, outlining that owners of small businesses are likely to be affected five times more than larger businesses.
SSMCOC President, Paul Johnson notes that a recent survey of Sault Ste. Marie Chamber members confirms that local business owners are acutely aware that Bill 148 may force some very difficult decisions. “Small and medium sized businesses are the lifeblood of our community, creating local jobs and increasing economic growth. We are being told by many that they feel they are being backed into a very tight corner with this legislation,” says Johnson.
The Sault Chamber recently surveyed its members and asked them to rate their level of concern on a number of the Bill’s labour and employment changes. More than 90% of the almost one-hundred respondents expressed a high level of concern about the minimum wage increase. 64% of respondents indicated that they expect to lessen the number of overall workers to meet the added costs that are anticipated, while 40% indicated that they plan to reduce the number of workers on certain shifts. Almost 60% indicated that they will redistribute responsibilities among current workers as opposed to hiring new staff and a similar number of respondents indicated that, as an owner or manager, they expect that they will assume more workload and responsibilities themselves to help offset increased costs.
In the coming weeks and months, the KOW coalition will release additional components to the economic impact analysis.
“Given the scale of impact and pace of change, it will be impossible for the provincial government to make businesses, even small businesses, whole through offsets,” adds Baldauf. “With amendments to the first reading of Bill 148 due this Wednesday, the legislation will need to see serious change including an adjusted timeline for implementation.”
Since Bill 148 was introduced in June, the KOW coalition has called on the government to conduct an economic impact analysis to fully understand how the legislation will change Ontario’s economy. With the government unwilling to do so, the report released today represents the first and only independent economic impact analysis of this legislation.
About the Keep Ontario Working Coalition:
The Keep Ontario Working Coalition (KOW) is a broad-spectrum group of business sector representatives concerned with sound public policy to help produce jobs and grow Ontario. Members include:
- Association of Canadian Search, Employment and Staffing Services (ACSESS)
- Canadian Franchise Association (CFA)
- Canadian Federation of Independent Grocers
- Food & Consumer Products of Canada (FCPC)
- Food and Beverage Ontario (FBO)
- National Association of Canada Consulting Businesses (NACCB Canada)
- Ontario Restaurant, Hotel and Motel Association (ORHMA)
- Ontario Chamber of Commerce (OCC)
- Ontario Federation of Agriculture (OFA)
- Ontario Forest Industries Association (OFIA)
- Ontario Home Builders’ Association (OHBA)
- Ontario Real Estate Association (OREA)
- Restaurants Canada
- Retail Council of Canada (RCC)
- Tourism Industry Association of Ontario (TIAO)
CANCEA is a state-of-the-art interdisciplinary research organization that is dedicated to objective, independent and evidence based analysis. They have a long history of providing holistic and collaborative understanding of the short- and long-term risks and returns behind policy decisions and prosperity. For more, go to cancea.ca.
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