Peterborough Social Planning Council

2015 Living Wage Report

Acknowledgements
The Peterborough Social Planning Council is pleased to release our second Living Wage
report for the City and County of Peterborough. PSPC is a partner with the Canadian
Centre for Policy Alternatives, Ontario Living Wage Network and involved with the
National Living Wage movement.
This report was prepared by Paul Armstrong, (consultant) using the formula and
expansive spreadsheet provided by the Canadian Centre for Policy Alternatives. We thank
the Canadian Centre for Policy Alternatives for reviewing our report for consistency.

Brenda Dales
Executive Director
Peterborough Social Planning Council
For more information, contact Brenda Dales at [email protected] or 705 743-5915

Released April 2016

PETERBROROUGHS 2015 LIVING WAGE

INTRODUCTION
Across this country there are growing levels of low paid work concomitant with belowacceptable standards of living. The question becomes: what are acceptable standards of
living and what amount of money is necessary to reach that standard. These questions
both define and frame the inquiry that establishes the living wage in each community.
While the family composition and expenses may differ by community, the taxes and
transfers associated with each family differ only by province. Note that some subsidies
may, in addition, vary by municipality.

WHAT IS A LIVING WAGE?

A living wage is the hourly pay required to cover basic expenses such as food, clothing,
shelter and transportation for an individual or family. Its a wage that allows employees
not just to subsist but to have a decent quality of life; to raise children, to participate in
the community, to be healthy and active social citizens.
The living wage is not the same as the minimum wage. The living wage sets a higher
standard for what an employee must earn in order to attain a decent standard of living
and quality of life. It reflects the real costs of living in their home community.
Nevertheless, the living wage is an assessment of modest living standards for a decent
quality of life and does not include a number of expenses that many people take for
granted including credit card and other loan repayments, savings for education and
retirement, home ownership or anything beyond minimal recreation.

EXECUTIVE SUMMARY
It has been three years since Peterboroughs living wage estimate was calculated at
$16.47/hr. in 2012. This report updates Peterboroughs living wage to reflect what it
takes for two working parents with two children to make ends meet in 2015. Its based on
the needs of a family with two parents and two young children ages 4 and 12. (Note: For
consistency, this update replicates the parameters used in 2012.) Now, in 2015, each of
those parents needs to earn $17.65 per hour, while working 37.5 hours per week, in
order to afford the basics in this city.
The updated Peterborough living wage calculation is founded in real life necessities and
responsibilities. It draws on the national living wage framework, a guideline developed by
living wage leaders from across the country that incorporates these basic principles into a
consistent definition and methodology to ensure uniformity of approach. However, taxes,
transfers, and even hours of work vary widely from province to province. In Ontario, the
CCPA (Canadian Centre for Policy Alternatives) developed a living wage calculator that
takes into account the tax and transfer rules in the province.
The most important ingredient in any living wage calculation is the list (and accompanying
cost) of necessary expenses for a family of four to meet its basic needs, participate in the
economic and social fabric of their community, and purchase items that can help them
escape marginal subsistence. The list does not contain any form of savings. Nor does it
acknowledge that debt obligations exist for the family. But it does recognize that things

Released April 2016

like rent, transportation, child care, food, clothing, internet, and laundry costs are part of
the basics that every family strives to meet. It should be noted that no employer-paid
benefits are calculated in the living wage other than those mandated by the Province of
Ontario and the Government of Canada.
Once total family expenses have been added up, the calculation moves to the income
side of the equation, which consists of both employment income and government
transfers. The living wage incorporates relevant government assistance, such as child care
benefits and the Working Income Tax Benefit. The next step calculates the employment
income this family needs in order to meet both family expenditures and pay taxes as well
as payroll deductions. The final step yields a living wage amount per hour based on the
total number of hours worked in the year.
Decent wages are a critical component of individual and family well being. Higher wages
mean a better standard of living for workers and their families. A living wage ensures that
workers earn enough to meet the basic necessities of life and to participate in their
community.
Living wage employers are finding that higher wages lead to more productive employees,
lower turnover and increased employee morale. In the service sector, this can lead to
improved customer service and higher profitability.
According to Statistics Canada, the median wage in 2010 for the Peterborough Census
Metropolitan Area was $29,294 or $15.02 per hour before taxes. Because this was a
median wage in a group of workers totalling 98,815 individuals, half of them (49,407) had
wages at or below $15.02 per hour. Two years later (2012) the living wage calculation
produced an hourly rate of $16.47.
In 2015, at $17.65 per hour, Peterboroughs living wage again sets a modest living
standard to ensure that workers earn enough money from work to provide for the
material necessities of a healthy, sustainable life with full civic and economic participation
in the local community.

THE LIVING WAGE MOVEMENT

A living wage in Canada is calculated based on the hourly wage necessary for a family
consisting of two working parents with two children to meet the basic needs after taxes,
transfers, and payroll deductions are taken into account. It provides an estimate of what
that family needs to earn in order to meet basic needs and participate in the civic and
social life of their community. The calculation is not national, its not provincial its done
municipality by municipality to reflect real local living costs and the hourly wage required
to meet those basic costs.
The living wage is not the same as the minimum wage. The minimum wage is the
provincially mandated minimum an employer is required to pay in a given jurisdiction. As
it stands today the minimum wage in Ontario is tied to inflation, but $11.25 an hour
doesnt take into account the basic requirements a family needs to get by. In fact,
Ontarios current minimum wage legislation still leaves workers earning far below the
poverty line, particularly if they are supporting dependents.

Released April 2016

Minimum Wage

Living Wage

Objective

Operationalization Legislation

Sets an expectation that work should

provide enough to meet basic material
and immaterial needs
Voluntary/aspirational

Jurisdiction

Provincial

Local

Quality of life
considerations

Does not take into account the

material needs of a healthy,
sustainable life
Adjusted for inflation (Ontario)

Reflective of the basic necessities of life

Cost of living
considerations

Sets a wage floor below which

employers cannot pay

Adjusted annually as costs increase

Thats where the living wage comes in: it sets a higher test by asking what workers need
to earn based on the cost of living in their community. The living wage calculation is
rooted in real life necessities and responsibilities. It takes into account the amount of
money a family needs in order to pay for non-discretionary bills - like rent, transportation,
food, and child care.
Over the past 10 years, a growing number of Canadian communities have been engaging
in the exercise of calculating what a local living wage is, to help evaluate the adequacy, or
inadequacy, of pay for a significant swath of low-wage workers. In Ontario, there is a
growing movement among communities across the province to promote their local living
wage calculation as a tool to improve the lives of its poorest workers.
Decent wages are the gateway to a better quality of life; they also contribute to wellbeing. A living wage supports full participation of families in the economic and social life
of their community. For example, the living wage calculation includes modest amounts to
cover non-OHIP medical insurance, a modest two-week vacation, and to allow parents to
upgrade their skills through continuing education.
The living wage proposed for Peterborough is by no means a luxury wage. Many items
that could be considered an essential component of a decent quality of life are not
included in the calculation. Peterboroughs living wage makes no provision for savings for
a childs education, retirement, home ownership, or even debt repayment.
There are benefits for business, too. Higher wages can be an important contributor to
worker productivity and success in business. Higher wages also tend to reduce employee
turnover, reduce company expenditures on training and improve morale, which can lead
directly to improved customer service.
Increasingly, these laudable social and economic objectives are recognized in efforts to
implement living wage policies among public and private sector employers. Theyre also
informing efforts to increase the provincially mandated minimum wage to ensure it lifts
workers out of poverty.
The living wage movement highlights an important element of work that is often
overlooked in conversations about pay: what do workers need to earn in order to meet
basic needs? Most people depend entirely on employment as a means to improve their

Released April 2016

standard of living. Pay is an important ingredient for policy makers focused on ensuring a
future built on the promise of decent work. That includes higher wages for Ontario
workers.
For further information, contact: CCPA-Ontario | 10 Dundas St. East | PO Box 47129 | Toronto | 416-5985985. [email protected] . www.policyalternatives.ca/ontario | @CCPA_Ont

BASIC LIVING WAGE CALCULATION

Annual Family Expenses = Income from employment + Government Transfers
CPP/EI/Income Tax Deductions (living wage)

SUMMARY
The living wage for Peterborough in 2015 is $17.65 per hour. This is the amount each of
two adults living together with two dependent children must earn. This amount is higher
than the living wage calculated in 2012 which was $16.47. While general inflation over
the three-year period would lead us to expect an increase in the living wage, the general
inflation rate cannot be used in any revised calculation. Individual living necessities
inflate at different rates and in some cases certain life necessities actually decreased over
the three-year period.
Every effort was made to make the two calculations (2012 and 2015) parallel and
consistent in the parameters that were used. However, the 2015 calculation had to take
into account certain modifications in keeping with a current lifestyle. An example would
be the telephone which was a home phone in 2012 while in 2015 two cell-phones were
chosen. In both cases costs were minimized and the resulting difference was quite small.
In both years the CMHC average market rent was used. Since this number may or may
not include utilities such as hydro, water, and heat, we were forced to make a decision. In
2012 we accepted the average market rent as utilities inclusive. However, because the
CMHC number averages rents with and without utilities, we must assume that a dollar
cost for some portion of utilities is embedded in the rent number they report. In 2015 we
decided to once again use the CMHC average market rent but calculated the cost of hydro
as an additional amount. We also assumed that the cost of water and heat was included
in the rent and did not calculate an additional amount for those items. In short, we have
concluded that, because the CMHC average market rent does not take into account each
individual household's arrangement when reporting average market rent, some discretion
on our part was required in calculating housing cost.
Since the standard for a living wage is always based on a family of four with two
dependent children, it is therefore inaccurate as a wage for working individuals living in
other household complements. For example, we would expect a family of two with one
dependent and a single person living alone to require a lesser hourly living wage rate,
while a family of three having two dependents to require a higher hourly living wage.
The family complement is not the only standardized feature of living wage calculations.

Released April 2016

Exclusions such as savings, debt obligation repayments, home-ownership costs, etc. are
standard features of the calculations. Inclusions, apart from those absolutely required for
survival, like a family outing once a month and the costs of a two-week period when the
family is together each year are also standardized. Mandating standards in living wage
calculations is imperative for reliability and comparison purposes.
The living wage amount for Peterborough and the living standard it sets is a measure
against which all other real wages can be compared. When compared to Ontarios
minimum wage, for example, it begs a discussion about the validity of the living standard
enforced by this arbitrary amount. Approximately 25 per cent of workers in the
Peterborough C.M.A. work part-time. It is reasonable to assume that these workers
receive minimum wage.

CONCLUSION
The living wage provides a standard of living cost analysis tool that attempts to establish
numerically the modest hourly wage requirement of workers in a specific community.
Items for the analysis were carefully chosen to cost out the life requirements for healthy,
sustainable living and minimal social engagement opportunities. In so doing, it delineates
a minimal living standard. The cost of meeting this standard is a numeric benchmark
against which all other wages can be compared.
The living wage effort grows out of a concern that all persons have the wage resources
essential to healthy living and participation in the life of the community. In Peterborough
the living wage amount is $17.65 an hour.

Released April 2016

Detailed Calculations for Peterborough's Living Wage

Average Monthly Costs (2015)
Category
Item

Family of 4

Data Source and Explanation of Calculations

Food, Clothing, Shelter Food

$761.11

Limited Incomes: A Recipe for Hunger,

October 2015, Peterborough County City
Health Unit

Clothing and
Footwear

$238.39

Cost adjusted from 2012 Peterborough Living

Wage amount, Consumer Price Index,
Clothing and Footwear, Statistics Canada

Rent and
Utilities

Rent 3Bdrm.
$1,173.00
Hydro
$152.00

Canada Mortgage and Housing Rental Market

Report, Ontario Highlights, Spring 2015
Peterborough Utilities Group, Nov. 2015
Assumption: Water and heat are included in
rent

Childcare

Childcare
$579.38
centre, afterschool and/or
summer care

Trent Child Care Centre (before and afterschool care = $419.25 monthly X 1 child)
(summer day care = $39.43 daily X two
children X 35 days of attendance each)

Transportation

Vehicle

See detailed vehicle cost notes: Average

Annual Cost of Vehicle Ownership

$635.32

Public Bus
$115.00
Transit and/or
Taxi

One 30-day adult bus pass ($60.)

Four cab fares (doctors' appointments, etc.)
($55.00)

Health

Non-OHIP
Health
Insurance

Blue Cross coverage: Basic Health Benefits

and Hospital Benefits for family of four.
(all individual personal data submitted)

Social Inclusion

Monthly
$136.00
Family Outing

Movie or local tourist attraction with modest

restaurant meal once each month

Family
$152.23
Vacation (two
weeks)

Vacation for family of four including

transportation, accommodations, meals,
entrance fees, and consumables. 2012 base
cost adjusted for inflation Bank of Canada
Inflation Calculator

Internet

$45.00

Cogeco High Speed

Cable TV

$57.00

Cogeco Value Pack

Telephone

$100.00

Two cell phones

Recreation

$129.00

Family of four recreational activities which

may include a family pass at YMCA/Wellness
Centre, family skating, swimming lessons, and
one other children's sports activity e.g. soccer

$221.24

Released April 2016

Category

Item

Family of 4

Data Source and Explanation of Calculations

Other

Continuing
Education

$86.40

Adult education upgrading, possibly jobrelated for each adult in the household. Taken
from 2012 Peterborough Living Wage and
inflation adjusted using Bank of Canada
Inflation Calculator

Tenants'
Insurance

$34.56

Basic tenant insurance coverage. Lowest

quote from Kanetix.ca Gore Mutual
Insurance

Household
$165.01
operation,
maintenance,
furnishings
and
equipment

Statistics Canada MBM of $157.00 for 2012

inflation adjusted (5.1%) using Consumer
Price Index for Household Operation,
Furnishings and Equipment to October 2015.
(Amount also includes laundry costs and bank
fees.)

School
Supplies and
Fees

2011 Report, Social Planning Toronto; 2011

cost adjusted for inflation to 2015. (for 2
children)

$55.90

Personal Care $56.21

Statistics Canada Market Basket Measure for

Census Metropolitan Areas between 30,000
and 99,000 population inflation adjusted
using Bank of Canada Inflation Calculator

Reading and $35.39

Entertainment
Supplies

Statistics Canada MBM of $34.00 for 2012

inflation adjusted using Bank of Canada
Inflation Calculator

Other not
specified

$106.17

Statistics Canada Market Basket Measure for

Census Metropolitan Areas between 30,000
and 99,000 population inflation adjusted
using Bank of Canada Inflation Calculator

$195.75

4% of family household budget

Contingency

Family Member
Parent A (male, age 35)
Parent B (female, age 30)
Child A (female, age 12)
Child B (male, age 4)

Daily Engagement
37.5 of work weekly (full-time employment)
37.5 of work weekly (full-time employment)
Attends School Full-time (no before and after school care)
Attends School Full-time (requires before and after school
care)

Released April 2016

Itemized Annual Costs (2015)

Category

Annual Cost (2012)

(Rounded to Nearest Dollar)

Annual Cost (2015)

(Rounded to Nearest Dollar)

Food

$8,424

$9,133

Clothing and Footwear

$2,676

$2,861

Rent

$13,464 (utilities included)

$14,076

Hydro

(see rent)

$1,824

Childcare

$8,604

$6,953

Vehicle

$7,992

$7,624

Bus and Taxi

$1,260

$1,380

Non-OHIP Health Insurance

$2,748

$2,655

Monthly Family Outing

$1,272

$1,632

Family Vacation

$1,752

$1,827

Internet

$492

$540

Cable T.V.

$444

$684

Telephone

$468

$1,200

Recreation

$1,476

$1,548

School Fees and Supplies

(not included)

$671

Continuing Education

$996

$1,037

Tenants Insurance

$312

$415

Household Operation

$1,884

$1,980

Personal Care

$648

$675

Reading and Entertainment

$408

$425

Communication (not
telephone)

$192

(not included)

Other (not specified)

$1,224

$1,274

Contingency

$1,812

$2,417

Total =

$58,548

$62,831

Released April 2016

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Annual Cost of Living (2015)

2012

Calculate

2015

Household Employment $64,220

Income

Before-tax entry

$68,835

Universal Child Care

Benefit

$1,200

Add

$1,920

Household Income

$65,420

Sub-total

$70,755

Tax After Credits

$4,263

Subtract

$5,744

Income After Tax

$61,157

Sub-total

$65,011

CPP and EI
Contributions

$4,008

Subtract

$4,355

Child Tax Benefit

$1,901

Add

$2,175

Child Care Subsidy

WTIB

Ontario Child Benefit

Income After Tax and

Transfers

$59,051

Total

$62,831

$16.47

Before-tax earnings
divided by 2 persons
and divided by 1950
hours (hours/year)

$17.65

LIVING WAGE RESULT

Result from Calculate Living Wage or Goal Seek Calculation: $17.65 / hour

Released April 2016

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Cost of Food Monthly (Peterborough County City Health Unit)

Sex

Age (years)

Cost Per Week

Male Adult

35

$55.91

Female Adult

30

$47.96

Female Child

12

$38.20

Male Child

$33.57

Total Cost Per Week

$175.64

Total Cost Per Month

$761.11

TOTAL ANNUALLY

$9,133.32

Average Annual Cost of Vehicle Ownership

Cost Item

Cost Per Month

Annual Cost

Depreciation

$221.67

$2,660.00

Insurance

$106.33 (Kanetix.ca)

$1,276.00

Gas

$225.32

$2,703.87

Oil Changes

$15.00

$180.00

Licence Sticker

$9.00

$108.00

Street Parking

$8.00

$96.00

Service and Repairs

$50.00

$600.00

Total Vehicle Cost

$635.32

$7,623.87

TOTAL ANNUALLY

$7,623.87

Notes: 11,337 miles or 18,139 km. annually; vehicle gas consumption rating = 20 mpg;
cost of gas = $1.05/L or $4.77/gal. Imperial 2012 Chevrolet Cruze LS 4 Door
Value: $10,914. Canadian Black Book Average Asking Price on December 2015
Commutes to work 15 km one way five days per week
Insurance: Comprehensive and Collision $500 deductible, $2,000,000 liability

Released April 2016

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Cost of School Supplies and Fees

Monthly Cost

Annual Cost

School Activity Fee

School Photos
Field Trips
School Fundraisers
School Supplies

$5.24
$2.62
$8.74
$5.24
$6.12

$62.90
$31.45
$104.83
$62.90
$73.38

TOTAL

$27.95

$335.45

Released April 2016

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Released April 2016