CALGARY—Paycheques for Alberta’s hospitality workers will soon be under a microscope thanks to a new Alberta government panel looking at the effects of minimum wage increases made under the previous NDP government.

At a news conference in Calgary on Thursday, Labour and Immigration Minister Jason Copping told reporters the panel will not only analyze the impacts of the decision to hike Alberta’s minimum wage to $15 an hour in 2018, but also look at whether alcohol servers would see higher net incomes if they had a wage differential. Typically, such differentials are lower than the general minimum wage.

Copping acknowledged a variety of data sets around minimum wage increases exist, but said they haven’t been looked at in the context of Alberta’s economy.

“Alberta currently has the highest minimum wage in the country and too many hard-working Albertans are struggling to find work,” Copping said.

Trevor Tombe, an associate professor in the University of Calgary’s department of economics, said good analysis of major economic questions, such as the minimum wage’s effects in Alberta, is always worthwhile. The effects of a $15 an hour minimum wage have been studied in other jurisdictions, such as the city of Seattle, where they’ve been implemented — but Tombe said their economic realities are quite different from Alberta’s.

But Tombe did dispute Copping’s notion that Alberta’s youth unemployment is due to minimum wage increases.

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“Detecting the effect of the minimum wage is uniquely challenging in Alberta over the past couple of years because it’s tied so closely to the recession,” he said. “You wouldn’t want to attribute employment losses in Alberta to a minimum wage increase when they could otherwise be accounted for by low oil prices and the recession that we went through.”

Chairing the “expert panel” is University of Alberta economics professor Joseph Marchand, who warned that the previous NDP government’s minimum wage hike could lead to as many as 25,000 job losses in Alberta. University of Waterloo economics professor Anindya Sen is the only other economist on the panel.

Tombe praised both economists as credible and rigorous in their analysis, noting Sen had published a recent paper on the effects of minimum wages in Canadian provinces.

However, critics slammed the panel as being too biased and the Opposition NDP said in a press release that the United Conservatives have simply “appointed yet another panel that will hurt Albertans by cutting minimum wage to workers.”

“This comes after the UCP already rolled back the minimum wage for youth and took away overtime pay for Alberta workers,” it read.

The panel’s membership also includes representatives from Restaurants Canada and the Canadian Federation of Independent Business, two lobby groups that support lower wages for alcohol servers and have criticized the previous NDP government’s minimum wage hikes.

Three servers from Alberta restaurants are also on the panel. However, two of them are from Calgary’s Blink Restaurant. The owner, Leslie Echino, is listed as a member of Restaurants Canada’s board of directors.

Copping couldn’t say whether any of the servers on the panel currently make minimum wage.

Other members include Jason Stanton, owner of the Edmonton-based Running Room, and Express Employment owner Branko Culo.

“I’m very confident that these experts will use all of their diverse perspectives to provide me with very solid advice, and I’m looking forward to reviewing their findings and recommendations,” Copping said.

Marchand said he hadn’t been told who was on the panel until Thursday’s announcement. He said he has produced several graphs related to the minimum wage based on data from Statistics Canada’s Labour Force Survey, but hasn’t updated them since April.

“Frankly, I didn’t know what I was going to do with them, and now I’ve been given the opportunity to put them to use,” Marchand said.

The panel is expected to start its work in September and wrap up by the middle of January. What happens next is up in the air, including whether Alberta will see a lower hourly wage for alcohol servers.

“We have no timeline. And we’ve also made no decision on that, as well,” Copping said. “It’s largely going to be driven by the recommendations.”

Estimating the precise effect of Alberta’s minimum wage increases on the economy in a matter of months will be a very tall order for the panel, according to Tombe.

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“They will not be able to do that,” he said. “But they might be able to help us think about some of the potential tradeoffs at a higher level, and maybe give a sense of magnitude in certain specific cases.”

Analyzing the effects of such a policy on an economy involves understanding a multitude of data points over years, or even decades. Tombe said Sen’s recent paper on minimum wages across Canada drew on roughly 40 years of data for its conclusions. By contrast, Alberta’s $15 an hour minimum wage has been around for less than a year.

“Typically, it takes some time to actually construct credible estimates of a policy change because you need data,” he said. “You need enough data before, during, and after a policy change in order to really tease out what the effect of that policy might be.”

The United Conservative Party has floated the idea of minimum wage rates below $15 an hour for certain workers in the past. However, Copping said the government would not be lowering the $15 an hour adult minimum wage.

“We were very clear during our platform and prior to the election that we are not going to reduce the general minimum wage,” he said.

In February, then-UCP Leader Jason Kenney proposed separate minimum wage rates for young workers and those serving alcohol at a Restaurants Canada event in Edmonton. In June, his government went on to implement a $13 an hour wage for students working during their holidays and the first 28 hours of a school week.

At the Restaurants Canada event, Kenney also suggested a separate minimum wage for alcohol servers would allow them to clock more hours without costing their bosses more, saying they tend to make most of their take-home income in tips anyway.

Alberta’s minimum wage was gradually raised by the NDP from $10.20 an hour in 2015 to $15 an hour last September. The move garnered praise from unions and advocacy organizations, which said it would reduce poverty among Alberta’s lowest-paid workers. But business organizations, such as the Canadian Federation of Independent Business, have argued the policy was implemented too quickly.

Marchand has criticized the previous NDP’s government minimum wage move. He authored a 2017 report for the C.D. Howe Institute that said Alberta’s planned wage increase could lead to the loss of roughly 25,000 jobs in the province. In the report, he suggested the province should have timed the wage increases to higher oil prices and added a job creation tax credit.

Separate wages for young workers and those serving alcohol exist in provinces such as Ontario, Quebec, Nova Scotia, and British Columbia. In Ontario, workers under the age of 18 can be paid a minimum hourly wage 85 cents less than an adult, while alcohol servers can make up to $1.80 less per hour.

Daniel Huber, founder of the restaurant worker advocacy association Alberta Vanguard, said he was “furious” with the government and concerned about the makeup of the panel, which mostly excludes voices from independent and small businesses.

“It’s a little alarming to see that he’s stacked the panel with those people that are coming kicking and screaming into 2020,” he said.

Huber took issue with Restaurants Canada being on the list of members because he doesn’t think “lobbying groups of any kind have any place developing policy,” especially ones that have campaigned against the minimum wage raise.

Restaurants Canada was a steady critic of the hike and also participated in lobbying during the province’s April election.

A focus on the minimum wage when discussing issues facing the restaurant industry is too narrow, Huber said — it needs to take into account the need for innovation, margins, the broader economy, slower restaurant attendance, and food costs.

His advocacy group also focuses on shining a light on the common practice of “house tipping,” where some businesses take servers’ tips — unmonitored and unchecked — to offset wages and to help with tough profit margins. This leaves service industry workers to “languish out on their own,” especially when there’s little organization among them, he said.

“There’s no discourse, there’s no conversation in front of the public, there’s nobody from the UCP going on radio shows to debate anybody about the merits about why this is a good conversation,” Huber said.

His best guess was that there would be a rollback amounting to $2 an hour for industry workers, but said skimming those dollars off a server’s wages “is not going to save the businesses.”

“The idea that (Kenney) is all for jobs, and the first thing he does is attack a specific large sector of working Albertans is absurd,” Huber said.

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