LOS ANGELES – Mayor Eric Garcetti formally introduced his plan to boost the city’s minimum wage to $13.25 an hour by 2017.
In his remarks at a Labor Day rally in Exposition Park, Garcetti touted the plan as “the largest anti-poverty program in this city’s history.”
As reported last week, the city’s minimum wage – which currently stands at $9 in accordance with the statewide standard – will go up to $10.25 by 2015, then increase by $1.50 over the next two years until it reaches $13.25. After this increase in 2017, the wage will rise to match the consumer price index of the city.
The proposed law would apply to anyone who works in Los Angeles, but state and federal government employees will be exempt.
According to the mayor, around 27 percent of the city’s residents live in poverty and over 560,000 workers earn minimum wage but cannot support themselves on it. He further stated that the #RaisetheWageLA campaign will “restore dignity for all Angelenos.”
Four professors at the Institute for Research on Labor and Employment at the University of California, Berkeley looked into the potential impact of this proposal.
Their findings include: “about 567,000 workers – or 37 percent of workers covered by the policy – would receive a pay raise under the proposed law by 2017; workers’ hourly wages and annual incomes would rise, resulting in a total increase in aggregate earnings of $1.8 billion by 2017; and adults, workers of colors, and working poor families would see significant benefits from the proposed policy.”
The study concluded that “most businesses would be able to absorb the increased costs, and consumers would see a small one-time increase in restaurant prices. The policy’s impact on overall employment is not likely to be significant.”
One of the biggest supporters of the mayor’s plan is businessman Eli Broad, who was present at the Labor Day rally.
“I spent more than 50 years running two Fortune 500 companies and I truly believe that raising the minimum wage is very good for business,” Broad said.
In an OP-ED entitled “Hiking LA’s minimum wage is a win-win” published in the Los Angeles Times, Broad wrote that “an increase in the minimum wage would not only be good for low-wage workers. It would also be good for the city, good for the economy and, in the long term, good for business. It is, simply put, the right thing to do.”
Broad also explained that workers with an increased salary will help drive the economy upwards because they will be spending their money in local businesses.
Labor groups and activists, including the LA County Federation of Labor, also joined the event in support of the Mayor. Though $13.25 is a start, groups are calling for an eventual raise to $15 an hour.
While some argue that the wage proposal will uplift Los Angeles residents living below the poverty line, others fear it will be detrimental to businesses.
“We’re concerned that a 50 percent increase will force a lot of businesses to either raise price, which hurts everybody, or to cut jobs, which hurts those people who lose their jobs,” Stuart Waldman, president of Valley Industry and Commerce Association said.
On Monday, President Obama also addressed the issue of minimum wage in front of a crowd in Milwaukee and referred to Mayor Garcetti’s plan as an example of what mayors across the country are doing.
“By almost every measure the American economy and American workers are better off than when I took office…the engines are revving a little louder,” Pres. Obama further said.
Despite Congress’ rejection of heightening the federal minimum wage to $10.10 an hour, Obama is maintaining his message that the economy is recovering as the November mid-term elections approach.
To date, 14 cities and counties have passed laws addressing minimum wage rates, including Seattle, which will see an increase to $15 by next April.
Seven city council members attended the Labor Day event in support of Garcetti’s plan. If they all vote in favor, only one more vote will be needed for it to pass.
(With reports from the Los Angeles Times and Associated Press)
(www.asianjournal.com)
(LA Midweek September 3-5, 2014 Sec. A pg.1)
