The hourly wage required to cover the cost of living in the Northwest Territories has risen significantly in the past two years, a study by Alternatives North suggests.
The study claims a single adult in Yellowknife must make at least $23.08 per hour to earn a living wage, defined as “the hourly earnings required to cover basic expenses.”
A couple with two children would each need to be earning $23.95 per hour in the city, the report, released on Wednesday, states. A single parent in Yellowknife requires $25.09 per hour.
In 2015, Yellowknife’s living wage was calculated by the same group to be $20.68. In 2017, it was $20.96.
What had been a 28-cent increase between 2015 and 2017 became a three-dollar increase between 2017 and 2019.
However, Alternatives North also changed its methodology slightly – moving from a 40-hour work week for its 2015 and 2017 calculations to a 37.5-hour work week in 2019.
The organization’s report said the 37.5-hour working week now “reflects a more common approach to living wage calculations in Canada.”
“There is a big impact from the change in the work week, but the other key thing that has occurred is expenses have gone up – particularly food and healthcare premiums,” said Michel Haener, the consultant who produced the report.
“That’s not unique to Yellowknife. I’ve done some other estimates recently and it’s the same for other communities – the cost of healthcare premiums has jumped significantly, and I saw a jump in childcare expenses for Yellowknife as well.”
The current legislated minimum wage in the NWT is $13.46.
“Workers across the NWT must earn well above the current minimum wage in order to earn enough to pay for expenses,” the report concluded.
The study’s living wage would work out to around $45,000 per year, before tax, for a single adult in Yellowknife, or $46,700 for each parent in a couple with two children. A single parent with one child would need $48,900.
Childcare, food, and Netflix
Alternatives North says its living wage recommendations are calculated using a “bare-bones budget” incorporating food, clothing and footwear, rent, transportation, childcare, healthcare, household expenses, adult education, “a modest vacation,” and a small emergency fund.
The figures provided in the 2019 report vary between communities.
For example, the study claims a single adult in Hay River needs a lower living wage than a parent; however, in Inuvik, a single adult needs a living wage higher than that of a parent.
Shelter, food, and childcare are broadly the three largest expenses for households with children, the study states.
The study provides 14 charts and appendices detailing the means by which Haener calculated the NWT’s 2019 living wage and providing precise figures.
Items factored into the calculation range from the varying tax burden between communities, to access to different health and childcare programs (such as Aboriginal Head Start in Inuvik), through to the cost of cellphones, a meal out each month, children’s toys, and a Netflix account.
The study suggests the stated living wage would allow a couple with two children access to the Canada Child Benefit, but would leave them ineligible for the NWT Child Benefit or GST credit.
Haener said tax changes represented another significant shift from 2017 to 2019.
“A few things have changed the tax burden on families,” she continued. “A few tax credits have disappeared. Yes, there is a nice new Canada Child Benefit, but there have also been eliminations.
“If you are engaged in adult education, you can no longer as a part-time student write off a monthly education amount. That actually has a pretty big impact on your total tax credits.”
‘Public information tool’
The study includes only three NWT communities as, Alternatives North said, those are the communities with sufficient data available.
Noeline Villebrun, an attendee at a briefing on the study held on Wednesday, said residents of the territory’s smaller communities would actually be the main beneficiaries of such studies given the financial demands placed on them.
“People in the communities are the ones that need this. Not Yellowknife, not Hay River,” she said.
“We will be the first to say we wish we could do the communities,” responded Suzette Montreuil from Alternatives North. “We don’t have the data.”
In 2017, a similar study performed in Whitehorse showed the Yukon capital’s living wage to be $18.26 at the time. The same year, Calgary’s living wage was estimated at $18.15.
Canmore had a 2017 living wage of $25.28, in a study involving the same author, based largely on the cost of rent.
Alternatives North is a form of northern liberal think tank, describing itself as a group advocating for social, environmental, and economic justice.
“This is a public information tool, it’s a lobby tool,” said Montreuil. The study will be presented to MLAs on the NWT’s standing committee on social development next week.
“Really, our point is there are three ways you can affect this,” said Montreuil. “You can increase the minimum wage, you can decrease expenses, or you can increase the number of transfers.
“But we have to get the word out that working people need a living wage.”