Is a living wage the answer?
Let me preface by stating that I fully support fair wages—this isn't a commentary on compensating hard-working and valuable employees. Nor is it a plea to pity small business owners. The following personal thoughts are about how 'more' isn't a sustainable solution for the future.
Everywhere we look, prices are increasing, and new taxes are on the table for discussion in hopes of fixing housing and economic problems.
Strictly as a small business owner (because I am not an oil and gas mogul and can't speak to their profit margins), our cost of goods went up not once but two and three times in 2022. In January, our cost of goods increased again for 2023. I know I'm not alone in this. Yesterday, a colleague mentioned how freight costs on one of their shipments went from $400 in 2022 to $700 in 2023. That's insane. The only way a small business can recoup those increases is to turn around and charge their customers more. That colleagues order was not heavy equipment, it was plastic food container lids.
Raising retail prices feels like a bandaid solution. And for many, there is a cap on how much consumers will pay (unless everyone makes more money to afford higher priced basic needs—see the vicious circle forming?). Independently owned cafes, who pride themselves on creating jobs in the community, can't pay each employee 60K-70K to match the new #livingwage and still charge $3 per beverage. The math simply doesn't work. No-one wants to pay $15 for a cup of coffee either.
'MORE' of everything isn't a solution; it perpetuates greed and continued inflation.
It's a novel idea that every business is generating a 'secrete' fortune allowing ability increase hourly wages every time we see the cost of living rise. Wage increases can temporarily ease financial burdens—definitely—but they don't stop the continual increases we see on a global scale. All the rising costs homeowners experience, are also increasing for small businesses: insurances, rent, electricity, heating, #propertytax etc. When we're standing in the isle shaking our head at prices that we don't want to pay, it's easy to forget all of the costs associated with getting that product on the shelf in the first place. Let alone keeping the store open that we're standing in.
Again, this is not a pity cry for business owners—quite the opposite. We are right there groaning with consumers; we do not want to raise our prices. The increases to our own cost of goods that I referenced earlier, was not 10-25 cents. They have increased $2-$4 per item. That's a large sum at the end of the year. But we don't feel we can raise our retail prices by the same proportions.
The economy needs long-term solutions to regulate and protect the cost of living so that everyone can afford to live, buy and sell without seeing crazy prices.
Our personal #propertytax in #Halifax was reassessed at 100K dollar more in 2023—not a single nail was replaced to improve the value of our home. From that #taxincrease, we are not getting more street lights; garbage is not being collected 'better' or more frequently; snow removal remains the same; there are no new services in the community. So why has the taxation increased so drastically? What problems is it working to solve?
We are all players in a global market, so even trying to correct or to stabilize the local #economy is a puzzle. #NovaScotia doesn't produce everything we need—we will always reply on import to some degree. And as individual consumers, we still have to be able to afford to live within the context of a larger economy if we hope to travel or leave our province.
The #costofliving has far exceeded what our local economy can support. And I don't believe the long-term answer will be charging the people 'more.' If the cost of living was reasonable, we could survive and even thrive on a lot less.
Is the system broken on too many levels? How we even begin to fix it? Have any ideas?
I welcome your input and commentary below!