Minimum Wage Workers

In a historic 14-1 vote yesterday, the Los Angeles City Council voted to raise the minimum wage to $15 per hour by 2020. The city attorney’s office has been directed to draft the language of the law for the Council’s final approval. Mayor Eric Garcetti has stated that he intends to sign the law.

California’s current minimum wage is $9 an hour, and is set to increase to $10 an hour statewide on January 1, 2016.

The Los Angeles minimum wage increases expected once the law is finalized are as follows:

  • July 1, 2016: $10.50
  • July 1, 2017: $12.00
  • July 1, 2018: $13.25
  • July 1, 2019: $14.25
  • July 1, 2020: $15

After that, the minimum wage would increase annually pegged to a measure of inflation. Small businesses would have an extra year to comply and certain non-profits could seek an exemption.

This law will have a tremendous impact on working Angelenos. According to a report by Economic Roundtable, the UCLA Labor Center, and the UCLA Institute for Research on Labor and Employment, 723,000 employed, working-age adults in Los Angeles earn less than $15.25 an hour. (That is around 40% of the Los Angeles workforce.) Twenty-two percent of them live in poverty.

Los Angeles is one of the most expensive cities in the country, including with respect to the costs of housing, food, and transportation–yet incomes have not kept up. Consider San Francisco, where the cost of living is only 20 percent higher, but median earnings are 70 percent higher. According to a press release for a UCLA study, Los Angeles has the most unaffordable rental market in the country:

As of 2013, Los Angeles had the highest median rent burden in the nation — at 47 percent. That is, on average, renters in L.A. are paying 47 percent of their income for rent. The share of renters experiencing moderate (30 to 50 percent of income) and severe (50-plus percent of income) rent burden in Los Angeles has consistently outpaced the nation.
. . .
Los Angeles has a lower median household income than comparable cities such as New York or San Francisco, but only a small difference in median rents.

This is a tremendous move on the part of Los Angeles, and nearby cities and the county are expected to consider similar measures. I have written before about how important it is to raise the minimum wage. The minimum wage increase is expected to have a strong stimulus effect in the poorest communities, where low-wage workers live and will spend their money when they shop at local businesses.

Tuesday’s success is attributable to hard work by labor, business, and community leaders and members, including through the Raise The Wage campaign. It is part of a broad national movement to raise the minimum wage across the country at the local, state, and federal levels.

Full-time workers and their children should not have to live in poverty. I applaud the Los Angeles City Council for taking steps ensure that those who work in Los Angeles can afford to live here.

Los Angeles Raises Minimum Wage to $15/Hr by 2020 was last modified: February 8th, 2017 by Ramit Mizrahi
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