“Even with a booming economy and millions of dollars in new money coming in, San Francisco is facing a projected $99 million budget deficit next fiscal year. And nearly half of it can be chalked up to the city’s skyrocketing pension costs.”
Average hourly earnings advanced 2.3% from a year earlier in November, the Labor Department said Friday, a pace that’s roughly been maintained over the past two years. That streak of steady wage gains has coincided with the economy adding an average of 234,000 jobs per month since November 2013, a clear acceleration compared with earlier in the expansion.
A significant portion of the decline in unemployment, however, is because many Californians have given up looking for work. Labor force participation in October was barely 62 percent, below the historic low in 1976. For those not around way back then, those were the dark years of “stagflation” – the triple whammy of slow economic growth, high unemployment and rising prices.
The owners of two high-profile Orange County restaurants are taking a stand on rising labor costs by implementing controversial changes that could lead to sticker shock on your next dining bill.
A coalition of labor and community groups stepped up its battle with a Chinese-owned company that manufactures electric vehicles in Los Angeles County on Tuesday, accusing the firm of breaking promises and failing to provide safe “living wage” jobs with the tens of millions of dollars the firm has received from government contracts and other public investment.
She plans to amend and revive stalled legislation guaranteeing double Thanksgiving pay so it would only apply to workers at large retail businesses that have more than 500 employees in California.
Earlier this month, Gov. Jerry Brown’s top aide, Nancy McFadden, when asked about the administration’s on-the-record opposition to efforts to raise the minimum wage, pointed out that a $15 minimum wage comes with a multi-billion price tag for state government.
After the minimum wage ordinance was approved, LoGuercio invested in a $150,000 industrial dishwasher he had been eyeing to save on utility costs. The machine will also allow him to stop paying six to eight people who earn $10 to $11 an hour washing dishes. LoGuercio expects to recoup his costs in nine months, and save a couple of hundred thousand dollars a year going forward.
“A minimum-wage job has always been the role of an entry-level position into the workforce,” Lapsley said. “(Those jobs are) to help get people initially trained and then move into a … different job so that they have a long-term future.”
“It doesn’t work,” said Chris Thornberg, a founding partner of Beacon Economics. “Does a higher minimum wage reduce poverty? No. Does it reduce homelessness? No. Does it get more at-risk inner-city youth to work? No. So why are we doing it? We have to find a different plan.”
As executive director of BANANAS, an Oakland-based nonprofit that connects families with childcare providers, he has seen how Oakland’s minimum wage hike has impacted workers who benefit from a higher wage, while creating new challenges for families facing more expensive or reduced access to child care. . . “Their profit margins are so thin to begin with, so they have to lay off those providers. So those are working people who are out of jobs. Then what happens is they have to reduce their services to families because license requirements (say) that if you don’t have a certain number of people in the center or the family childcare home, you have to reduce the number of families you serve. So families have lost their child care.”
The inefficiency of the minimum wage stems directly from who are working minimum wage jobs in California. First, based on the Census Bureau’s Current Population Survey, in 2014, almost one-third of hourly workers making $9 per hour live in households with family income above the federal poverty line; moreover, 79 percent were ages 25 or younger (i.e. individuals who are just entering the labor force). And lastly, 73 percent of Californian hourly workers making $9 per hour (or less) didn’t have a college degree, suggesting a majority of minimum wage workers are, in fact, lower skilled.
Now, after Local 1000 recently reached impasse with 135 of its administrative and support staff represented by United Auto Workers Local 2350, the last offer put on the table is going out for a vote. The deal offers a modest raise but rolls back retiree health benefits. Members have rejected similar agreements before.
That said, would increasing the minimum wage help to decrease the poverty rate? In this paper, we addressed that topic, developing a regression model looking at minimum wage, education level, labor force participation rate, and the cost of living and their impact on the poverty rate. Our results indicate that there is no statistical significance between minimum wage and poverty rate and our other independent variables were all statistically stronger than minimum wage.
Weak productivity growth is one reason employers could be reluctant to raise wages. If workers don’t become more efficient, businesses may see little need to hand out raises. Productivity advanced at a 1.6% seasonally adjusted annual pace in the third quarter. But from a year earlier, business productivity improved just 0.4%.