With P.E.I.'s inflation rate the highest in Canada, what should happen to the minimum wage?

Islanders have until Thursday, July 14, to make submissions to the Employment Standards Board's minimum wage review.

The board makes recommendations to the province on changing the minimum wage based on public input.

This year, the review comes at a pivotal point in the province's economy, with runaway energy prices driving the inflation rate to 11.1 per cent in May, the highest in the country.

Although P.E.I.'s minimum wage rose 70 cents on April 1, to $13.70 per hour, that 5.4 per cent increase was not enough to keep up with inflation. In real terms, $13.70 in May of this year had the same value as $12.33 in May 2021.

While business groups say they would be fine with a moderate wage increase, they say they're worried that if the province raises the minimum wage too high right now, it might jeopardize a post-pandemic economic recovery.

"I don't think that the small business community should shoulder the burden [of inflation] alone," said Robert Godfrey, CEO of the Greater Charlottetown Area Chamber of Commerce.

"We're all trying to build back," he said.

"We're trying to take advantage of the strong tourism season, we're trying to take advantage of getting what we can to fill in what has largely been three years of challenges. So to have a substantial increase in minimum wage would be very detrimental."

According to Statistics Canada, average weekly earnings on P.E.I. for the month of April were $968.92 per week, which is 17 per cent below the national average. Assuming a 40-hour work week, that's about $24.22 per hour.

In the chamber's submission to the Employee Standards Board, it recommends raising the province's basic personal amount instead of the minimum wage to bring it in line with the national average of $13,092.

"We're taxing low-income islanders at a rate higher than anywhere else in Atlantic Canada. And our basic personal amount. I mean, my hat is off to the government this year, they've honoured a campaign commitment to get it to $12,000. But they're still well below the Canadian average."

But Ann Wheatley, program co-ordinator with the Cooper Institute, said doing something like that would be a "regressive move" because it would benefit high-income earners more while cutting money that would go toward public services.

The institute usually makes a submission to the Employment Standards Board through the P.E.I. Working Group for Livable Income, a network of community-based organizations.

"Clearly, the minimum wage has to go up. I think that it needs to sort of strive for a livable wage," she said.