Calif. To Stick a Pin in Its Recovery Nicely with $10 Minimum Wage

Can the state bear the costs?Credit: Peter Kaminski / Foter / CC BYOn Thursday, economists at UCLA noted that California’s job recovery and growth is very lopsided. While unemployment in the state is dropping, the recovery is mostly in tech industry on the coast, well-paid jobs that require training. In the meantime, the state’s manufacturing and logistics fields are stagnating or even declining.

Also on Thursday, the state’s legislature voted to raise the minimum wage to $10 an hour by 2016, making it the highest in the nation. Via Reuters:

The bill, which Governor Jerry Brown said he will sign, would increase the minimum wage for hourly workers in the most populous U.S. state from the current rate of $8 an hour to $9 in July 2014, and to $10 by January 2016. 

"The minimum wage has not kept pace with rising costs," Brown, a Democrat, said in a statement. "This legislation is overdue and will help families that are struggling in this harsh economy." 

Brown, protective of the state's tenuous economic recovery, had initially opposed the bill but agreed to support it on Wednesday after leaders of both houses of the Democratic-led state legislature agreed to postpone the effective date of the raise until 2016. 

I’m not exactly sure what they think is going to be so different about 2016 that makes this move suddenly acceptable. Perhaps businesses will lay people off in advance so when the day actually comes politicians can declare no major impacts following the increase (because they all happened before)?

Unemployment rates for inland counties in California are still in double digits. San Bernardino County is at 10.8 percent. The unemployment rate for agriculture-focused Imperial County (on the southern border of the state) is a whopping 26.1 percent (pdf). And these numbers don’t include those who have dropped out of the labor force entirely so the real number is higher.

So the parts of the state most in need of unskilled, low-wage positions just to help families stay afloat are going to find them even harder to come by.

Also in the news are efforts to modify the state’s abuse-inviting Environmental Quality Act (CEQA), which has made the construction of any new building in California nearly impossible or at least much more expensive than it needs to be. Legislators have been trying to reform CEQA, which is often used by labor and environmental groups (or just about anybody with an ax to grind) to force concessions (like labor agreements or land set-asides) or face lawsuits. CEQA is certainly a contributing factor in the challenge of building industry in those parts of California economists warn are still struggling.

Proposed reforms didn’t make it through the legislature this year. But legislators did pass a bill that smoothed CEQA's impact on a new taxpayer-funded arena in Sacramento for the Kings. So that’s nice for them.

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  • Cliché Bandit||

    Well, It was a pretty state while it lasted.

  • Swiss Servator, Spare a Franc?||

    "This legislation is overdue and will help families that are struggling in this harsh economy."

    Nothing helps a harsh economy like raising costs on employers, Moonbeam.

  • Doctor Whom||

    What do you mean? The money needed will just mystically appear. This sort of thing never affects the job market, nor do businesses ever pass on costs.

    This is what utopian daydreamers actually believe.

  • ||

    The money needed will just mystically appear.

    ALL businessmen have a swimming pool full of money in their basements. They usually swim in it while slave children polish their monocles.

    All we are asking for is some of THAT money that's not being put to good use.

  • MJGreen||

    But they have all those profits. They'll just deduct the costs from that. It's so simple!

  • NoVAHockey||

    It's a mystery of the faith.

  • sarcasmic||

    Obviously! I mean, they're rich aren't they? That means they haven't paid their fair share! If they had paid their fair share then they wouldn't be rich, now would they? So they've got plenty of profits to share with the workers! They're rich!

  • ||

    You're just an evil rethuglican Scott, only worried about the companies bottom lines and profits. Why don't you care about the poor workers who need a living wage?

    /proglodyte

  • Andrew S.||

    It's cute that you think that anybody in Sacramento cares bout the inland areas (well, except for Sacramento). What's next, thinking that anybody in New York State government cares about anything north or west of Albany?

  • UnCivilServant||

    What's next, thinking that anybody in New York State government cares about anything north or west of Albany New York City?

    FTFY

  • Andrew S.||

    They care about Westchester too! And they care about Albany itself.

  • UnCivilServant||

    Being in Albany at the moment, I can assure you, they do not.

  • Andrew S.||

    When I lived in Syracuse, that was the common refrain, the state government only caring about Albany and points south and east. Guess they had too rosy a view.

  • UnCivilServant||

    They come here because they have to, and it lets them pretend to not be all about the city (and clock per deims for 'travel' to their day job).

  • Doctor Whom||

    Maryland politicians don't even bother pretending not to be all about the Baltimore area.

  • RBS||

    Considering Baltimore, maybe that's better for the rest of MD?

  • UnCivilServant||

    Not really - they post all the baltimore-centric rules and crush the rest of the state. That would be like thinking NYC centric lawmaking would help upstate instead of shred it.

  • UnCivilServant||

    "Give us poverty, or give us death"

    Also, "More incentive to hire the undocumented"

  • Outlaw||

    Hi, Scott.

  • Snark Plissken||

    It's call a living wage. What do you have against living, Scott?

  • The Late P Brooks||

    "The minimum wage has not kept pace with rising costs," Brown, a Democrat, said in a statement

    Get back on the plantation, Jerry.

    THERE IS NO INFLATION

  • MJGreen||

    Fucking. Idiots.

    But I guess it's totally expected with the (California) Democrats holding a supermajority. That poor, poor state.

  • DJF||

    So is California going to go after the employers of cheap illegal labor or is that too politically incorrect?

  • ||

    Why do Californians hate the chilrenz?

    So, I guess the plan in CA is to have the 16 year olds leave the state to gain job experience in entry level positions and then come back after acquiring it to look for a better job in CA?

    Good plan, as usual, CA. You guyz are wicked smaaght!

  • UnCivilServant||

    But to a Califorian, these aren't 16-year olds doing these jobs, but family breadwinners! Mind you, I've never found a breadwinner behind the counter, but maybe it's a California thing...

  • KPres||

    Don't know about California, but nationally the median household income for somebody working at the minimum wage is over $50,000/year.

  • Certified Public Asskicker||

    From the below link:

    More than 90% of minimum-wage workers in the state are over the age of 20

    So yeah, flipping burgers is a career, just like being an engineer.

    http://money.cnn.com/2013/09/1.....?iid=HP_LN

  • UnCivilServant||

    So there's such a shortage of real jobs that those 20+-somethings are taking the high schoolers' jerbs?

  • Fatty Bolger||

    Yep.

  • sarcasmic||

    You mean employers are choosing 20-somethings over teenagers? Who'd a thunk it?

  • R C Dean||

    I think he means there are so many adults who have no real alternative that employers aren't forced to realy on teenagers.

  • Certified Public Asskicker||

    Or even consider them at all.

  • Leigh||

    Minimum wage has decimated the job opportunities for teenagers. As an employer, you find the most qualified person that you can, for the price you are willing to pay. When that price is set by someone else, then suddenly the job qualifications go up. So long teenage job.

    What do you call a person whose labor is less than the minimum wage?

    Permanently unemployed.

  • ||

    So, I guess the plan in CA is to have the 16 year olds leave the state to gain job experience in entry level positions and then come back after acquiring it to look for a better job in CA?

    California: The Mexico of America!

  • Jgalt1975||

    I’m not exactly sure what they think is going to be so different about 2016 that makes this move suddenly acceptable.

    Isn't this the same blog where both posters and commenters routinely claim that there's severe inflation going on? If this law contains no inflation indexing (the post implies it's not indexed), and we're actually experiencing inflation, then $10 in 2016 will not be worth as much as $10 today, so by delaying the increase it will be less of a burden on employers. (And this is before even considering that delaying the increase could reduce the negative impact on employers by giving them time to make budgeting and contracting decisions that mitigate any added expenses from wage increases.)

  • KPres||

    In all fairness to California, an $8/hour minimum wage in L.A. is the equivalent of about $5.60/hour in say, Atlanta. Even the $10/hour would only amount to $7.10.

    Of course, that's just further reason that there shouldn't be a FEDERAL minimum wage, since the cost-of-living in various places is wildly different. Let the states make their own.

  • PapayaSF||

    The historical tidbit I like to bring up to minimum wage supporters is that the original Progressive arguments for it were eugenic: it was to make white women less employable, so they'd stay home and have babies, and to deny jobs to blacks and the handicapped, to make them less able to afford children.

  • Doctor Whom||

    I've pointed out the racist origins of some of the proglodytes' favorite laws. I tend to get that all-purpose scathing rebuttal known as "La la la, I can't hear you."

  • PapayaSF||

    Gun control to disarm blacks, true. I can't think of any others, though.

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