Every month it’s the same story. Rents are up. Food costs are still high. We’re bracing for record-breaking utility costs this winter. We’re all feeling the pinch of affordability these days, but when your income is $15, $16, or even $20 per hour it means making trade-offs on basic necessities.
Vibrant Communities Calgary has been publishing Calgary’s living wage since 2008 as a resource for policymakers and employers. A living wage reflects what people need to earn to maintain a modest standard of living based on the actual costs of living in a specific community and it is determined by calculating average expenses using local costs, subtracting taxes, and adding government transfers for a given household.
Here are five things to know about Calgary’s 2023 living wage.
$23.70 per hour is now what it takes to have a modest standard of living in Calgary.
The Alberta Living Wage Network determines the costs in eight categories based on a weighted average of three family types. You can check out the data sources and details in our living wage brief, but the most important thing to note is there isn’t one municipality in Alberta where someone can make ends meet earning minimum wage. In fact, in Calgary, the living wage is almost $9 an hour more than our current minimum wage.
Lower-wage workers are not just kids living at home with their parents.
We often hear that people think lower-wage workers are kids living with their parents. We decided to take a closer look at who’s earning under $20 in our city. We reviewed the latest Statistics Canada Labour Force numbers and 85% of workers earning $20 an hour or under are adults and 36% have children.
Shelter costs were the largest contributor to increases in this year’s living wages.
We’ve been beating this drum all year. Shelter costs have gone up a lot over the past year –about $2,846 in extra costs over last year were attributed to increases in shelter costs in Calgary. For someone living on a low income that is a massive jump, so not surprisingly we’re seeing more and more people struggling to afford housing. Electricity also increased by 39% over the year which added to the shelter cost increases.
The living wage calculation confirmed what we’ve been hearing. What’s more, our latest research says 115,000 people in Calgary are at extreme risk of homelessness. Calgary needs more affordable housing and until more housing is built, rental assistance and subsidies need to be more widely available.
Government policy played a role in keeping the living wages lower this year.
Certain government benefits kept the living wages lower than expected this year. The Canada Child Benefit, which was increased by 6.3% in 2023, 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 for families with children.
Both the provincial and federal governments also created temporary affordability payments. For instance, the Federal Grocery Rebate provided $130 for single parents. The Alberta Affordability payments provided $1,200 for a family of four and $600 for families with one child, and the Alberta Fuel Tax Relief Program saved families about $124 on gas. Without these temporary benefits, the living wage would have been $24.60. These programs certainly helped people, but because they were temporary, increases to living wages next year will likely be higher.
Wages are not keeping pace with the cost of living.
We decided to take a look at how wages were responding to the rising cost of living. We graphed the percentage of increase in wages with the percentage increases in food, shelter, and other costs with a case year of September 2013. Food has gone up by 41% over the 10-year period and wages only went up by 24%. We have to consider how this type of discrepancy impacts those making the lowest incomes.
A comparison of wages with the Consumer Price Indexes
Source: the Labour Force Survey (LFS) Public Use Microdata File and Consumer Price Index (CPI), both provided by Statistics Canada.