As inflation rates have soared in recent months, the impact has been felt by employers and employees alike. According to Statistics Canada, Canada’s inflation rate, now at 7.7%, has skyrocketed at the fastest pace in almost 40 years. This is the highest rate since 1983.
In an ideal world, wages would keep up with rising inflation rates. Currently, this is not the case across many industries.
Why wages can’t keep up?
The relationship between inflation, wages and business costs is circular and intertwined. Due to inflation, both the costs of living and the costs of doing business are drastically increasing, making wage increases for many businesses challenging or, in some cases, unsustainable. If a company is able to invest in higher wages, they likely have to increase the prices of their products and/or services to account for their overhead. Thus a further increase in the cost of living.
Continue Reading Soaring Inflation Rates and Deflated Wages