California Minimum Wage Poised to Reach $10 an Hour

Money

SACRAMENTO, Calif. (AP) — California’s minimum wage would rise to $10 an hour within three years under a bill that is all but certain to head to Gov. Jerry Brown on Thursday, giving the state one of the highest rates in the nation.

Washington state currently has the top minimum wage at $9.19 an hour, an amount that is pegged to rise with inflation. Some cities, including San Francisco, have slightly higher minimum wages.

The state Senate approved AB10 on a party-line 26-11 vote, sending it to the Assembly for a final vote that will be a mere formality before it goes to the governor. Brown indicated earlier this week that he would sign the bill, calling it an overdue piece of legislation that would help working-class families. The bill would gradually raise California’s minimum wage from the current $8 an hour to $10 by 2016.

It would be the first increase in the state’s minimum wage in six years and comes amid a national debate over whether it is fair to pay fast-food workers, retail clerks and others wages so low that they often have to work second or third jobs.  The wage hike will also be felt in Hollywood by putting pressure on pay rates for lower-rung production jobs, movie theater works and other entry-level positions.

Democrats said the bill by Assemblyman Luis Alejo, D-Watsonville, would help workers left behind during the recent recession. The California Chamber of Commerce fears it would drive up businesses’ costs by ratcheting up other wages and workers’ compensation payments.

“We have it tagged as a job killer, given the increased costs businesses will be faced with,” Jennifer Barrera, an advocate for the chamber, said before the vote.

The bill generated a detailed, statistic-laced, 40-minute debate in the Senate.

“If you give people a couple more dollars an hour … to spend in their communities, spend it they will. They’re not going to put it into a hedge fund,” said Sen. Marty Block, D-San Diego.

He added that, “Nothing will make small businesses happier. This will stimulate the economy, as well as helping people’s lives.”

But Republican lawmakers said it would harm the economy, price low-skilled workers out of the market and encourage businesses to cut jobs and automate.

“This is a classic example with how out of touch state leaders are,” said Sen. Jim Nielsen, R-Gerber.

Sen. Ted Gaines, R-Rocklin, said liberals want to raise the cost of tobacco to discourage its use without realizing the same principle applies to labor: “If you make something more expensive, people will buy less of it.”

Democrats who make up the majority of the Legislature called the wage hike a matter of economic justice.

“The American Dream is clearly fading fast,” said Sen. Mark Leno, D-San Francisco. “The income disparity in this country has not been this severe since 1917.”

If it becomes law, California would gradually overtake Washington state. Neighboring Oregon and Nevada also have higher basic wages.

Federal law sets a minimum wage of $7.25 per hour, but California is among 19 states and the District of Columbia that set a higher state minimum wage.

The federal minimum provides $15,080 a year assuming 40-hour work week, which is $50 below the federal poverty line for a family of two. More than 15 million workers nationally earn the national minimum, which compares compared to the median national salary of $40,350, according to the Bureau of Labor Statistics.

President Barack Obama has sought an increase of the federal minimum wage to $9 an hour.

San Francisco currently has the nation’s highest minimum wage at $10.50 an hour.

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  1. Karl Gerber says:

    Having represented more than 1,400 employees, many low-wage workers, those who are actually trying to support a household on a minimum wage or a near minimum wage job usually have more than one job. While an increase in minimum wage is important to many, this debate brings up many other debates. Recently, I have written many articles about minimum wage in labor. My California articles can be viewed at http://www.worklawyerca.com/category/blog

  2. James says:

    There is no such thing as a forced layoff due to wage hikes. For all those that keep sputtering that phrase as a truth, do your research. It’s called CYA or “I’m gonna keep my 100k salary at any cost”. I’ve seen it first hand and there is a reserved circle of hell for people like that.

  3. The economic reality is that because of this law fewer teenagers and college students will be able to find work and people looking for part-time work to supplement their incomes will be out of luck. I own and operate a small independent game store and have to constantly turn away prospective employees even at $8.00/hr. $10 per hour just means that I can’t hire that 4th person and will be thinking about letting the 17yr old highschooler go…

  4. GKN says:

    The wage is so low, given the costs of living, that not only do people need two or three jobs, they have to resort to food stamps, welfare, etc. In other words, one of the reasons Walmart is the richest family in America is because we taxpayers cover costs that they refuse to. One blurb (though there are fuller studies on this: http://www.sanders.senate.gov/newsroom/media/view/?id=c15fe064-5056-a032-52e7-87b43ec8eccf&utm_source=berniebuzz&utm_medium=email&utm_content=Watch+MSNBC+Interview&utm_campaign=National+Bernie+Buzz+7-25

  5. It’s so much better to be unemployed at $10 per hour than at $8.00. Why not $25.00 per hour then everyone would be better off, right? Nothing more effective at destroying jobs for the very people they are meant to help–the low skilled, entry level type positions. But who said economic reality ever meant anything in the temples of the left?

    • Michael says:

      Do you rightys really believe that people making $8-10 an hour are going to hoard it away like a 1 percenter? No, they’re going to spend it on food, goods, etc. THAT’s good for the economy.

      • Aimee says:

        $8.00 is underemployment, which is just as bad, if not worse, than unemployment because a) you’re too busy working to find a job, b) you can’t afford education to get a better job and c) most employers do not promote people, so you could work forever at $8 and never earn more or gain additional job skills. Employers are not *forced* to lay people off. I’d wager my own salary, having worked in a variety of small businesses in HR in California for many years, that the majority of employers with less than 50 employees that have income of over $250k who are complaining about this increase could afford it, but are choosing to cut costs in labor in order to save money for higher draws for executives. I’ve seen it time and again, employers whose balance sheets absolutely allow for benefits or higher starting salaries, but only if executives make sacrifices to their “style of living”, which, of course, they aren’t willing to do. I’ve sat in meetings with executives talking about slashing benefits, or cutting mid-level jobs, so they can later cut large draw checks for a big vacations or home remodels or a variety of other personal “lifestyle” choices. The problem is that most employers simply aren’t telling the whole truth. Regardless of whether the business is that morally depraved though, it’s worth noting that without those “entry level” employees, most businesses wouldn’t function because they wouldn’t have anyone to actually provide the good and/or service. It’s not like the executives are servicing customers or producing any actual work product. I will grant you that there are some notable exceptions–small contracting companies, small boutique/retail stores and local/family owned restaurants, but the people complaining the loudest in the media are not being completely honest.

      • Mark Ross says:

        That is a ridiculous argument. Raise the minimum wage like that and companies are forced to lay people off and raise prices. The increase spending is negligable at best. Plus minimum wage is basically for jobs that kids hold and for extra money. It’s not meant to live off of. The left doesn’t get economics, which is obvious when you look at Obama!!
        http://smallbusiness.chron.com/problems-minimum-wage-increases-2691.html

  6. Kevin Perry says:

    If we ever want to see a decrease in crime, especially in urban America then we must realize that low wages have low income families still in survival mode, if we ever want to see the kind of country that we all desire to live in, then we have to get people in life mode and e e do that by paying them fair wages.

    • Kevin, $2.00 more per hour to work at McDonalds or ring people up at a convenience store is going to decrease crime how?… Crime happens because many people have no skills to offer and don’t want to work REGARDLESS of what the minimum wage is.

  7. yvonne says:

    San Jose, CA already has the minimum wage set at $10hr.

  8. Bill Hunt says:

    Great! California should lead the way to change the nation.

  9. Nanny Mo says:

    Well, time to move the post house to Nevada. You can do so much online these days anyway. It’s a shame to see Cally die off. It used to be paradise.

  10. bruce nahin says:

    Inflation will now become rampant now..count on prices everywhere going up..those of us on fixed income will suffer as we wont get a raise anywhere but will suffer higher costs of everything

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