Publié le 1 October 2024
There has been a new increase to the minimum wage in Ontario in 2024, affecting workers and employers across the province.
In 2024, Ontario will see a new minimum wage come into effect on October 1st. This is a result of the provincial minimum wage being tied to the Consumer Price Index in an attempt to help keep pace with inflation and the cost of living experienced by workers throughout the province.
What is the Minimum Wage in Ontario in 2024?
The minimum wage in Ontario in 2024 is $17.20 per hour, effective on October 1st. This raises the minimum wage from $16.55, which had come into effect on October 1st, 2023. This is a 3.9% increase and a $0.65 raise to the Ontario minimum wage. Ontario now offers the second-highest minimum wage of any Canadian province.
What Is The Consumer Price Index?
This increase to the Ontario minimum wage is due to the province linking its minimum wage rate to the Consumer Price Index (CPI). This is a method of tracking the price changes for products as experienced by Canadian consumers. Put simply, when the cost of products increases, so does the CPI. In theory, linking the minimum wage rate to the CPI helps people earning this wage be able to afford the products they need in their daily lives.
What About The Alternative Minimum For Tip-Earners?
Certain jurisdictions in Canada allow employers to pay their employees at a rate that is below minimum wage if they work jobs where they can earn extra gratuities, mainly tips. This is known as the alternative minimum wage, and primarily affects people employed in the food and hospitality industries. While it used to be very common, this practice has been eliminated in any province except Quebec.
The alternative minimum wage for liquor servers was eliminated in Ontario in 2022, so the new rate continues to apply to all workers over the age of 18 in the province. For students under the age of 18, the new Ontario minimum wage is $16.20 per hour.
What Is The Average Salary In Ontario?
The average salary in Ontario was $67,762.5 per year at the beginning of 2024 ($36.14 per hour, 37.5 hours per week, 50 weeks per year with two weeks vacation). It should be noted that annual salary can differ wildly between industries, job levels and geographic areas throughout the province. At the new Ontario minimum wage rate of $17.20 per hour, a person working 37.5 hours per week for 50 weeks of the year (with two vacation weeks) will earn $32,255.00 in a 12-month period before taxes.
What Is The Living Wage In Ontario?
The living wage is defined as the actual hourly wage rate or salary required to meet the costs of living in a particular area or community. It considers the cost of rent, goods, transportation and other costs people must pay. The minimum wage rate in Ontario is below the living wage in every part of the province, even after the October 2024 increase. The living wage is different in each region of the province as a result of varying rental markets and other factors. For example, the lowest living wage is $18.65 per hour in Southwest Ontario, while the highest is $25.05 per hour in the Greater Toronto Area.
Does It Keep Pace With Inflation?
For the first time since the pandemic, the minimum wage in Ontario in 2024 is keeping pace with the current rate of inflation — defined as a rise in prices paired with a decrease in purchasing power. The new minimum wage of $17.20 per hour represents a 3.9% increase, while the Canadian inflation rate was 2.5% as of July 2024. While this is a positive sign, it must be noted that the rate of inflation was at record high for the previous 4 years, peaking at 6.8% in 2022. Inflation is still currently affecting millions of people across the country, leading to increased costs of living and more uncertainty in all job sectors and industries.
The minimum wage in Ontario in 2024 has increase to $17.20 per hour. Despite this 3.9% raise, previous years of increased inflation and the continued high cost of living still pose a very significant challenge to minimum wage earners trying to provide for themselves and their families.