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The premier should not be picking fights with small business owners

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By Dan Kelly

Published in the Toronto Star January 7, 2018

 

Who’s the real bully here? Could it be the government that has said businesses that can’t pay a $15 per hour wage don’t deserve to be in business? Could it be the government is publicly shaming businesses that are taking tough but needed steps to stay afloat and protect jobs?

Premier Kathleen Wynne’s shock over small business owners’ reaction to the wage hike — be it increasing prices or reducing benefits, hours or positions — would have a lot more credibility had her government ordered even a basic impact assessment of the minimum wage hike before moving forward.

We asked for one, numerous times, over the past several months; 94 per cent of our members want one. But the government consistently refused, opting instead to blindly roll the dice with people’s livelihoods.

Why would they do that? To borrow a phrase from the premier, “I’ll be blunt.”

This whole social experiment is an act of a government that doesn’t appear to give a care in the world as to how their actions affect the small businesses on Main Street. It is a pre-election goodie paid for by your local dry cleaner, coffee shop, and mechanic — not by your government.

It’s about election optics, plain and simple. After all, it is easy to play Santa with someone else’s money.

What’s happening now should not come as a surprise. We warned them. Other employer groups and employers warned them. Banks warned them. The independent Financial Accountability Officer warned them that business owners would be forced to make difficult decisions as a result of the speed and magnitude of the hike.

Small businesses are not multinational conglomerates. In fact, even many of those with international brand names are locally owned and operated small firms. The average profit margin for a restaurant in Ontario is only 3.5 per cent.

The government clearly tuned out the small businesses that appeared before committee — many of whom feared government retribution for speaking out — especially those from the food services sector.

The fact of the matter is that the Ontario government didn’t take a scalpel approach. Instead, it lobbed a grenade at your local grocer, accountant and favourite restaurant, and are now feigning surprise that the shrapnel isn’t contained.

The situation in the news last week is certainly not unique. In fact, 18 per cent of business owners said they are scaling back their employee benefits to accommodate the wage hike in a December 2017 CFIB survey.

I’m even more concerned by the 28 per cent who said they were forced to reduce the number of employees and the 31 per cent who said they are cutting hours. Most worrisome is the 50 per cent of small firms who said they have reduced or eliminated plans to hire young or inexperienced workers.

Helping low-wage earners is a laudable goal and a discussion we should all be having. There are ways to do it that don’t hurt employers’ ability to provide strong, stable jobs, such as lowering personal income taxes, providing tax exemptions, enhancing the Working Income Tax benefit, or providing targeted skills training programs. Sadly, the government chose to limit the discussion to the minimum wage.

It’s past time we put policy ahead of ideology.

The premier’s desire to meet and have business owners come directly to her is a marked turn from last year’s committee hearings, which were stacked with unions and groups sympathetic to the government’s already-made decision. Many courageous business owners were turned away.

But if she’s truly had a change of heart, I can think of thousands of CFIB members — not billionaires or jet-setting CEOs, but middle-class Ontarians — who would love to tell her exactly what her $15 minimum wage plan means for their future, and the future of their employees.

If the premier is looking to pick a fight, I urge her to pick it with me and not the independent business owners taking all of the risks, protecting the jobs and growing the economy.

Dan Kelly is president of the Canadian Federation of Independent Business.

This story was originally published in the Toronto Star.