The Minimum Wage in Ontario In 2022
Publié le 28 September 2022
The second increase in less than a year means another change to the minimum wage in Ontario in 2022, affecting workers across the province.
In 2022, Ontario is seeing not one, but two minimum wage increases. This is a result of the minimum wage in Ontario in 2022 being tied to the Consumer Price Index in an attempt to help keep pace with inflation and the cost of living experienced by workers throughout the province.
What is the Minimum Wage in Ontario in 2022?
The minimum wage in Ontario in 2022 is $15.50 per hour, effective on October 1st. This raises the minimum wage from $15.00, which had come into effect on January 1st, 2022. The minimum wage in Ontario has now gone up by $1.15 — an 8% increase — from $14.35 in 2021. Ontario now offers the second-highest minimum wage of any Canadian province.
What Is The Consumer Price Index?
This second increase of 2022 is due to Ontario tying its minimum wage rate to the Consumer Price Index (CPI). This is a method of tracking the changes in prices for all products as experienced by Canadian consumers. Put simply, when the cost of products increases, so does the CPI. Linking the minimum wage rate to the CPI helps people earning this wage be able to afford the products they need, in theory.
What About The Alternative Minimum For Tip-Earners?
Certain jurisdictions in Canada allow employers to pay their employees at a rate that is below minimum wage if they work in job roles where they can earn tips and extra gratuities. This is known as the alternative minimum wage, and primarily affects people employed in the food and hospitality industries. Ontario eliminated the alternative minimum wage on January 1st, 2022. This meant that the minimum wage in these positions rose from $12.55 per hour to $15.00 per hour, an increase of 19.5%. Additional legislation extended the new minimum wage to people working in gig-economy jobs, removing the last elements of the old alternative minimum wage in Ontario.
What Is The Average Salary In Ontario?
The average salary in Ontario was $60,667.88 per year at the end of 2021. It should be noted that annual salary can differ wildly between industries, job levels and geographic areas throughout the province. At the new Ontario minimum wage rate of $15.50 per hour, a person working 37.5 hours per week will earn $30,225.00 in a 12-month period before taxes.
What Is The Living Wage In Ontario?
The minimum wage rate in Ontario is below the living wage in every part of the province, even after the October 2022 increase. The living wage is defined as the actual hourly wage rate or salary required to meet the costs of living in a particular area or community. It takes into account the cost of rent, goods, transportation and other costs people have to pay. The living wage is different in each region of the province as a result of varying rental markets and other factors. For example, the lowest living wage is $16.20 per hour in Sault Ste. Marie, while the highest is $22.08 per hour in Toronto.
Does It Keep Pace With Inflation?
Unfortunately, the minimum wage in Ontario in 2022 is not keeping pace with the current rate of inflation — defined as a rise in prices paired with a decrease in purchasing power. The new minimum wage of $15.00 per hour represents a 4.52% increase, while inflation has increased 7.6% in Canada as of July 2022. Inflation is still currently affecting millions of people across the country, leading to increased uncertainty in all job sectors and industries.
The minimum wage in Ontario in 2022 has gone up for the second time in under a year to $15.50 per hour. Despite this 8% increase, rising inflation and the continued high cost of living still pose a very significant challenge to minimum wage earners trying to provide for themselves and their families.
