Ontario's recent decision to hike its minimum wage to $15 an
hour would cost Metro tens of millions of dollars next year and put
pressure on the entire industry, the grocery chain's CEO said
Tuesday.
In revealing its quarterly results, the chain said it would be
exerting " strong control" over its expenses in the coming year,
citing wage increases as a major factor in its outlook.
"The announced minimum wage increase in Ontario will put
significant pressure on our industry in 2018," Eric R. La Fleche
said.
We estimate the impact of the increase in the minimum wage
recently announced in Ontario to be approximately $45 to $50
million on an annualized basis."
The comments come on the heels of similar ones from other
retailers who say rising wages will stretch their thin margins and
even put many out of business.
Metro rival Loblaw said last month that it expects rising wage
pressures will cost it $190 million next year.
Metro gave the warning on wage costs as it revealed quarterly
results for the three-month period ended July 1, during which the
chain's net income rose 3.7 per cent, or $4.5 million, compared to
the same time last year, at $183 million or 78 cents per
share.
Metro's overall sales edged up 1.4 per cent or $58.7 million
to $4.07 billion, but same-store sales dropped 0.2 per cent.
on the basis of this article discuss in about 500 words on the
basis of the following learning objectives:
1) describe how legislated price ceilings and price floors
affect equilibrium price and quantity.
2)compare the short-run and long-run effects of legislated
rent controls.
3) describe the relationship between economic surplus and the
efficiency of a market.
4) explain why price controls and output quotas tend to be
inefficient for society as a whole