LA is largest US city with $15 min. wage
AFTER a crucial vote on Saturday, June 13, Los Angeles Mayor Eric Garcetti signed a measure gradually raising the minimum wage to $15 an hour, making LA the largest city in the US to mandate the new wage.
“[The law is] a major victory for our city,” Garcetti said at a signing ceremony on Saturday. “The wage increases will enable working families to lift themselves out of poverty. LA as a whole will benefit from this boost.”
The mandate will require employers to gradually raise minimum wages in Los Angeles, starting next July at $10.50. Annual increases will move to $12, $13.25, $14.25, and eventually to $15 an hour by July 2020. The law applies to businesses with 26 or more employees, with a one-year delay for smaller (25 or fewer employees) businesses. Non-profits and small businesses have until 2021 to reach the $15 hourly mark.
Once the wage reaches $15 per hour, for both small and large employers, the measure calls for the minimum wage in 2022 to keep increasing based on the cost of living, indexed to inflation.
In a city where many entertainment and business industry folks make relatively high wages, the new legislation is aimed at lifting the millions of LA employees who work in service, retail, hotel, and fast-food jobs.
Many critics have said the current wage at $9 an hour is “barely livable.”
“We have always prospered the most when everyone is able to spend money into our economy,” Mayor Garcetti continued.
Calls for raising the wage have grown tremendously across the nation, as the US struggles with fallout from the recent recession, worsening income inequality, persistent poverty, and the challenges of staying afloat in the global economy.
Los Angeles follows Seattle and San Francisco, among other major cities, in gradually raising the minimum wage. Last year, Chicago passed a phased-in minimum wage increase to $13 an hour by 2019. Seattle and San Francisco’s minimum wages will reach $15 by 2018.
Many small business owners and labor groups opposing the regulation say they will have to raise prices, if not shut down or relocate, if the wage changes.
The issue is also expected to play out in the 2016 presidential race. Democrat contender, for instance, Hillary Clinton has been endorsing the higher wage.
California’s Senate assembly is also weighing a bill to raise the minimum wage to $13 in 2017, and keep increasing that rate based on inflation.
Businesses support wage increases
LA County Supervisor Sheila Kuehl introduced a plan on Tuesday, June 16 for the county to adopt an ordinance that would “complement” the new minimum wage law enacted this month.
The motion calls for an ordinance to be drafted and considered later this month, according to a spokesman for Kuehl. It would parallel the city’s schedule of step increases beginning next July for most minimum wage workers.
“Kuehl’s motion would also ensure that [Los Angeles] county, as the Southland’s largest employer, would grant similar raises for the more than 5,000 minimum wage workers on its own payroll,” said spokesman Joel Bellman.
The original proposal evolved after Kuehl reviewed four economic studies commissioned to examine a wage hike in LA and a city-commissioned peer review of the studies.
The supervisor’s preliminary work also involved an examination of a “county-ordered review by the Los Angeles Economic Development Corp. (LAEDC) of the four city studies and of the potential economic impacts of enacting a similar ordinance in the county’s unincorporated areas,” Bellman added.
“The LAEDC report…includes striking new findings. The vast majority of businesses anticipated few if any negative impacts from raising the minimum wage, and literally not a single business reported planning to close its doors, as many critics have warned,” he said.
Most businesses, according to the study, do not plan to lay off workers, reduce their hours, or relocate. The majority even “anticipated savings in recruitment and training costs” from lower job turnover, and higher productivity from “a happier, more stable workforce.” (With reports from Los Angeles Daily News, CNN, USA Today, Fox News)
(LA Midweek June 17 – 19, 2015 Sec. A pg.1)