A family of four with both parents working needs to earn this wage to pay the bills, avoid poverty

By Roderick Benns

A living wage reflects the true cost of living, while a minimum wage is mandated by law and is the same throughout Ontario.

New data just released from the Ontario Living Wage Network shows that a family of four in this region, with both parents working full-time, would each need to earn $19.05 an hour to cover basic expenses in 2022 .

This is the minimum they need to earn in order to pay their bills and avoid living in poverty.

“This year’s living wage calculations emerge against a backdrop of record inflation and increases in the consumer price index, and workers at the bottom end of the wage scale are the most vulnerable to these kinds of fluctuations,” says a Press release.

“A living wage is an effective tool for fighting in-work poverty by making sure employees can make ends meet where they live. By incorporating the expenses a worker must cover, such as housing, food, transportation and more, our living wages are much closer to reality than a politically mandated minimum wage.

Living wages are different from minimum wages. A living wage reflects the true cost of living, while a minimum wage is mandated by law and is the same throughout Ontario.

The Ontario Living Wage Network calculates the living wage using local data collected by the Health Unit, including the cost of food, housing (including rent, utilities and tenant insurance), telephone, internet, transportation, child care, continuing education (one university course per year per adult) and medical/life insurance.

The Living Wage Network uses a standardized spreadsheet to calculate each community’s living wage, while also factoring in government transfers such as child tax benefits, child care benefits, and government tax and deductions. The living wage calculation also takes into account a fixed amount throughout Ontario for clothing, footwear and contingencies.

How it is calculated

The living wage regions are based on Statistics Canada’s geographic concept of economic regions, according to a release from the Ontario Living Wage Network. (Economic regions are geographical units defined by Statistics Canada to represent regional economies.) Kawartha Lakes is located in the Eastern Region.

The living wage is the hourly wage someone must earn in order to have an income that covers the cost of living.

“To calculate this number, we start by determining the costs of a basket of basic goods and services for three types of families: two parents aged 35 and two children aged 7 and 3, a single parent (35) with a years old, and only one adult. To calculate the living wage, we determine the after-tax income each adult would need to have to cover the expenses included in the basket for their type of household. When calculating salary, we consider government transfers that the family can receive (such as Canada Child Benefit, Ontario CARE subsidy) and payroll and income taxes that adults can pay.

We calculate a salary for each of the three households, then take a weighted average of these salaries based on the proportion of Ontario adults in each household type using data from the 2016 census.

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