California is set to make a decision in November on whether the state should increase its minimum wage to $18 by 2026, which would make it the highest statewide minimum wage in the country. This move would bring California in line with Hawaii, where workers are on track to receive at least $18 per hour by 2028.
Currently, California’s minimum wage is $16, and the proposed ballot measure, Proposition 32, would raise it to $17 for the remainder of 2024 for employers with 26 or more employees. By January 2025, the minimum wage would increase to $18 per hour. Smaller businesses with less than 26 employees would be required to pay their employees $17 an hour in 2025 and $18 per hour in 2026.
Supporters of the measure argue that it will help low-wage workers support their families in one of the most expensive states in the country. They claim that many minimum wage workers are forced to rely on government assistance to make ends meet, which they see as a form of corporate welfare.
On the other hand, opponents of the measure, such as the California Chamber of Commerce, believe that the increase would be difficult for businesses, especially small ones with tight profit margins, to implement. They argue that the added costs would be passed on to consumers and could potentially result in job cuts.
While nearly 40 cities in California already have minimum wages higher than the state’s, some business owners have expressed concerns about the impact of such increases. For example, a survey conducted in West Hollywood found that 42% of businesses had to lay off employees or reduce their hours due to the local minimum wage ordinance.
Fast food workers in California saw their wages increase to $20 per hour in April under a new law signed by Governor Gavin Newsom. However, this wage hike led to a 3.7% increase in fast food prices, according to a study from the University of California, Berkeley.
Despite concerns about potential job losses, studies have shown that raising the minimum wage does not significantly impact overall employment rates. Additionally, a report from the California Legislative Analyst’s Office revealed that many low-wage workers are over the age of 35, challenging the notion that these jobs are primarily held by students or younger workers.
Small business owners, like Juliette Kunin from Sacramento, are already facing challenges due to inflation affecting their bottom line. While Kunin supports the idea of workers being able to support themselves, she is concerned about the financial implications for her business.
Workers, like Christian Medina, a banquet captain at the Sheraton Grand Sacramento Hotel, hope that the proposed minimum wage increase will allow them to better provide for their families. However, some, like uniform attendant Carmen Riestra, who already earns $19 per hour, feel that even an $18 minimum wage would not be sufficient to afford living expenses in cities like Sacramento.
The debate over raising the minimum wage in California highlights the complex economic considerations involved in balancing the needs of low-wage workers and the viability of businesses. As the state moves towards a decision on this issue, it remains to be seen how the potential impacts will play out for workers and employers alike.