Los Angeles Needs a Higher Minimum Wage

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There’s no arguing with numbers; Los Angeles needs a minimum wage increase, and it needs more than the current policies are willing to give. It is not a new argument, either, or even a very bold one. The cost of living has exceeded the average wage for some time (18.7% above the national average, according to Forbes).

For the sake of transparency, and to give you an example of who would benefit most from a wage increase like this, I’ll tell you about myself. I am in my mid-to-late twenties. I am a student who works in a part-time, minimum wage job, and I still live with a parent. I am poor. I qualify for food stamps, but I consider myself fortunate enough to live with a parent who is willing and able to help me out, and therefore I abstain from applying for them. There are others who work harder and still have a greater need for such things than me.

I work in the foodservice industry. I make $9 an hour, the current California minimum wage. I work four to five hours a shift, sometimes six if things are busy, giving me 15-20 hours if it’s a good week. I make tips. When I was hired, I was told that my average income of my hourly wage and tips combined would come out to $14-$15.

This has never happened. On a good day it’s $12. This means I have some extra cash on hand for the upcoming week as I live between my paychecks. If I hoard them away like some kind of shabby dragon who has a fascination with crumpled bills, it can really help out with my bills or even be used recreationally. (Which, if you don’t think poor people are allowed to have fun, we’ve got an entirely different conversation to have for another day.)

The Proposed Wages

The current policies proposed by the local officials looks good for someone in my position. In the next three years, the minimum wage will increase to $13.25 an hour by 2017, putting one at$27,560 a year, a few thousand more above the poverty line for one adult. This will trump the state wage, and for some perspective, blows the federal minimum wage out of the water.

Curbed has some great infographics on what living in Los Angeles on that $13 an hour will look like.

Source: Curbed

Source: Curbed

Spoilers: it’s still not enough, because the cost of living far exceeds any proposed minimum wage plans. Even Los Angeles’ mayor, Eric Garcetti, agrees with this. The next best proposal out there is for $15.25, lead by the LA Raise the Wage coalition, which would put one at $31,720 in a full time job. This, even part-time with two adults, is certainly not ideal but less bleak. Someone in my position might be able to figure things out with the help of scholarships and social welfare programs.

The trick is to keep up with the climbing cost of living as the years go by.

The Nay-Sayers

There’s a lot of arguments against raising the minimum wage, mostly by out-of-touch baby boomers who were able to work a part time job in the 1960s or 1970s and afford college without any form of debt. The thing is, back then it was completely feasible to do those things, because the cost of a college class unit was able to paid for with a few hours of minimum wage work then. This is no longer the case because the cost of living has risen but the minimum wage has only risen a fraction of the amount to meet it.

This doesn’t even begin to cover the number of families who have to raise children on subminimum wages due to wage theft and illegal working conditions, the wage gap between genders and ethnicities, discrimination against differently abled individuals, and a slew of other things that keep people in poverty.

So let’s look at the most popular arguments I have heard against raising the minimum wage in the foodservice industry.

It hurts small businesses, forcing them to fire people or shut down entirely.

Yes and no. A wage increase all at once certainly does hurt many businesses, such as what San Francisco and Seattle did, but that is why policy and lawmakers need to be working with economists to figure out the best transitional period for such things. A tax break or even subsidization for small businesses with less than 50 employees would go a long way.

The logistics aside, it has also been shown in numerous studies that a higher minimum wage means more people are out spending money, meaning more customers for one’s business. Here’s one by the UCLA Institute for Research on Labor and Employment of the cost-benefit analysis of raising the minimum wage to $15.25 will do for Los Angeles. And another by UC Berkeley. And for good measure, a third by Beacon Economics.

Food service workers make up the difference in tips.

As I said earlier, no. Not really. The National Restaurant Association has been pushing for a subminimum wage that would only pay the difference in what you didn’t make in tips. This is actually illegal in California and completely unenforceable for those that receive undeclared tips. Another caveat they want to include is having teens under 18 also receive a subminimum wage, because they “aren’t supporting a family.”

Having customers subsidize the cost of one’s employees is unethical and inconsistent.

It will force the cost of goods to increase.

The cost of goods is going up anyway. Raising the minimum wage would not be the cause of it.

Now What?

We do everything else we do to bring attention to an issue: we talk about it. We share our experiences and we don’t let the people who benefit from the current system in place to tell us that our problems are not important, or that we are unworthy of equality. We speak up.

Purple-haired Pepper Potts.

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