Technology, skills training helps local shops survive minimum wage hike
How 3 London-based businesses are surviving the minimum wage hike
The new year is bringing changes to London-based businesses and a provincial minimum wage hike has left several local shop-owners wondering if they'll survive.
Ontario Premier Kathleen Wynne announced a plan to increase the provincial minimum wage from $11.60 to $14 an hour beginning Monday and $15 an hour by Jan. 1, 2019.
It will then rise annually with inflation.
And with Ontario's plan in place, some local business owners are focused on new and innovative ways to adapt to the change, while others anxiously wait to see how the change will affect their shops and livelihoods.
Here's how three local businesses have been forced to change in 2018 in order to survive the minimum wage hike.
Globally Local
Pegged as Canada's first vegan fast-food restaurant, Globally Local is rolling out with self-checkout technology — part of a creative strategy — to keep up with inflating minimum wage costs.
The meat-free, dairy-free and animal byproduct-free fast-food menu will be placed on iPads for customers to order on and pay with.
The technology will relieve a few service duties from frontline employees who will then be appointed to higher-skilled jobs, said owner James McInnes.
"Even though we're small, we are agile and we're very good at adapting to change and being able to thrive. We've looked at this as a way to make our business better, more efficient and utilize technology," he said.
"We're looking at elevating people and giving them more training to higher-skilled jobs and for the lower-skilled jobs."
The higher-skilled jobs focus on graphic design and functional duties, normally being filled by roles that pay higher than minimum wage before the increase.
Currently two locations, one in the core and another in the east end, employ about 35 people with the majority being paid slightly more than minimum wage. McInnes said the technology won't eliminate any jobs.
Although prices will largely remain untouched, McInnes said a slight increase could be on the horizon to make up for rising costs. But, he's confident it won't deter customers.
Forked River Brewing Company
Even the small-scale, local brewing company is feeling the pressure of rising costs.
"[The minimum wage hike] is a big jump. I don't think we've seen a big jump like this ever," said President David Reed, adding he had to ask himself, "Can we absorb that or do we have to pass some of that along to the customer?"
The answer? For the first time since its conception five years ago, a can or bottle of the local brew could get a little pricier. But, not by much and not that soon.
The 11-person shop will look for ways to work more efficiently, said Reed, whether they have to rejig schedules or roles. But, no one will be fired, not even the third of the company who will see their wages increase.
"We're not in a position to eliminate more positions, but work more efficiently … We can't let go of people; we're a very lean operation. We can't afford to lose somebody," said Reed, who sees the hike as a reward for some of his coworkers.
"It's to provide a basic living wage to employees and we try to treat people the way we want to be treated."
The company sells to the LCBO, Beer Store, and other local bars and restaurants that may see direct price increases from the their end.
Nonetheless, Reed is confident customers will continue to pour in even if prices increase.
"There's huge growth in people looking to buy a local product … they spend a dollar here then it's going to pay for local jobs in the city."
Illbury and Goose
When the owner of the popular clothing brand in London looks to hire this summer, he'll look for a even more diverse list of qualifications.
Dan Phillips said a minimum wage hike is forcing him to look at multi-skilled hires that can do more than one job in order to make up for increasing costs.
"When we look to hire someone new, we will look at what other skills they have…Someone who is well- rounded so they can do a little bit of everything," he said.
"I thought [the hike] was a drastic move. I wasn't too excited, to be honest. But you can't really fight back too much, you have to kind of go with the flow and adapt to the situation."
Phillips said local factories that help supply products and garments gave him a heads-up about increasing labour costs before the hike. This means a chain reaction would see an increase in product costs.
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