Head to Head
Conversations on Politics, Policy in the Golden State
By Dave Regan
California�s New $15 Minimum Wage is Model for Country
Once again, California is serving as a model for the nation. In April, Gov. Jerry Brown signed into law a $15 minimum wage that is the most progressive � and yet reasonable � in the country. It benefits more than five million workers, accommodates small businesses and adjusts in the case of a slowing economy.
Getting by on California�s current minimum wage of $10 is nearly impossible. For a full-time worker, that amounts to less than $21,000 a year. Factor in California�s very high cost of living and it becomes clear how difficult it is to cover rent, transportation and food on such a limited budget. Add a child or two into the mix and we can understand why low-wage workers must work two or three jobs just to scrape by.
It�s not just a handful of workers who fit that category. Nearly 90 percent of minimum wage workers in California are age 20 or older, and 30 percent are parents. No matter where these folks live � whether it�s Los Angeles, Fresno or Sacramento � the current minimum wage is so low that it doesn�t provide enough for an individual worker, much less one with a family.
At the same time, the new minimum wage law has business interests in mind. It allows ample time to adapt, by phasing in the increase over six years � or seven years in the case of businesses with 25 or fewer employees. It also includes the opportunity to delay the raise for a year should the economy falter.
Raising the minimum wage strengthens local economies. Higher wages put more money into workers� pockets, money they spend at local businesses that in turn help those establishments grow and create more jobs.
This law will make a huge difference for millions of hard-working Californians. It recognizes that a minimum wage worker in the Central Valley is just as valuable as a worker living on the coast, and puts the state on a path to get there together. The best way to lift our economy is to raise the income of all low-wage workers.
Dave Regan is president of SEIU-United Healthcare Workers West, a union of 85,000 hospital workers in California, which qualified an initiative for the November ballot to raise the state�s minimum wage to $15. The opinions in this article are presented in the spirit of spurring discussion and reflect those of the author and not necessarily the treasurer, his office or the State of California.
By Jot Condie
Minimum wage increase too large, too fast
With California�s tax revenues coming in approximately $1.9 billion lower than originally projected, Gov. Jerry Brown is explicitly warning California legislators against expanding state programs and services for California families.
Which begs the question: why did lawmakers hastily adopt a minimum wage plan that, when fully implemented, incurs ongoing costs to the state of $3.9 billion a year? Wages are often considered a strong indicator of an economy�s strength. But with revenue shortages on the horizon, expected cuts in vital programs and services, and an unaffordable minimum wage plan, this policy inadvertently harms the very workers it seeks to help.
While unveiling his 2016-17 spending plan in January, the governor cautioned against raising the minimum wage beyond the hourly $10, stating, �Raise the minimum wage too much and you put a lot of poor people out of work. There won�t be a lot of jobs. It�s a matter of balance.�
However only two months later, confronted with a pending minimum wage initiative and feeling pressure from organized labor, California lawmakers sang a different tune. A backroom deal snatched the issue from the hands of voters and placed it into the lap of the Legislature. Senate Bill 3 was fast-tracked through the legislative process and signed into law by the governor in less than a week.
To be clear, an increase to $15 an hour is the equivalent of a 180 percent increase in eight years. This unprecedented pay hike, coupled with ties to inflation and negligible mitigations for small business, leaves California juggling higher costs under unpredictable variables.
For Californians statewide, this means fewer public sector jobs, and cuts in vital services such as education, non-profits, In-Home Supportive Services, developmental services, child care, and more. Bigger picture, this unfunded mandate paired with an economic downturn will devastate low-income families on a long-term scale.
The abrupt increase in minimum wage did not provide an adequate amount of time to understand the impacts of our last increase, let alone what impacts future increases will have on communities throughout the state. This is simply too large an increase, too fast and creates too many long-term consequences for California�s most vulnerable populations.
Jot Condie is the co-chair of California Consumers Against Higher Prices Coalition. The opinions in this article are presented in the spirit of spurring discussion and reflect those of the author and not necessarily the treasurer, his office or the State of California.