Los Angeles became the largest US city to raise its minimum wage to $15 an hour on Tuesday, as a wage increase bill passed the city council by a vote of 14-1.
It is now up to city attorney Mike Feuer to draft an ordinance to implement the new minimum wage requirements. The ordinance will then return to the council for a final vote before becoming law. Under the proposed legislation, the city’s minimum wage would increase to $10.50 in July 2016, and would increase incrementally every year until it reaches $15 in July 2020. For small businesses with 25 or fewer employees, the wage hike would come on a modified schedule with the incremental increases starting in July 2017 and the minimum wage reaching $15 by July 2021.
The current minimum wage in California is $9 an hour and is set to increase to $10 in January 2016.
In the past year, two other US cities have approved similar wage increase measures. In June 2014, Seattle moved to increase its minimum wage to $15 by 2017. Last November, San Francisco voted to increase its minimum wage to $15 by 2018.
Other cities, including New York and Chicago, are considering raising their minimum wage to $15 an hour. In February,New York City mayor Bill de Blasio called for a $15 minimum wage by 2019 in his state of the city address.
The shift toward raising the minimum wage by local lawmakers comes at a time when the fight for $15 movement has swelled into the largest protest by low-wage workers in US history. On 15 April, some 60,000 workers in more than 200 US cities took part in the Fight for $15 demonstrations. Many of them were low-wage employees of companies like Walmart and McDonald’s, which have since pledged to increase their workers’ pay by $1-$2 an hour, a raise activists said is still not enough.
“By voting to raise the minimum wage to $15 an hour, the Los Angeles City Council has just shown what workers are capable of when we stick together. People used to think we had no chance, but we are steadily winning the fight by demanding $15 an hour to lift our families out of poverty,” said Albina Ardon, 29, a mother of two and an active member of the Fight for $15 in Los Angeles.
Ardon, who has worked for McDonald’s for 10 years, earns $9.05 an hour and relies on food stamps and Medi-Cal to make ends meet.
“My life would be completely different if I were paid $15 an hour. I could afford groceries without needing food stamps, my family could stop sharing our apartment with renters for extra money, and I’d be able to provide my daughters with some security.”
The federally mandated minimum wage has stayed at $7.25 since June 2009. While the unemployment rate has dropped to 5.4% – a seven-year low – and the number of jobless claim is at a 15-year low, wages remain stagnant.
President Barack Obama previously called on Congress to raise it to $10.10 . Democrats, led by Washington senator Patty Murray and Congressman Bobby Scott recently introduced a bill that would raise federal minimum wage to $12 an hour by 2020.
Advocates for higher minimum wage like Unite Here and Raise the Wage attended the Los Angeles city council hearing on Tuesday. Prior to the vote, the council opened the proposal to debate and allowed each of the sides 25 minutes to make their arguments for and against the $15 minimum wage. Those on the opposing side included small business owners and restaurant owners, who said that higher minimum wage would force them to increase prices or let go of some of their staff.
Council member Bernard Parks has previously expressed concern about $15 minimum wage leading to higher unemployment in the area.
“Every minimum wage increase that we’ve seen, if it’s too high, causes unemployment,” Gloria told DB in February. “If you have a big city like Los Angeles doing something, you’re going to find a lot of people will fall in line without any thought, because they believe that we’ve done the research. The fact is, we have not done the research.”
The city has commissioned a report from the Institute for Research on Labor Employment from University of California, Berkeley. The report found that by increasing minimum wage to $15.25 by 2019, as some city council members had suggested in the past, would affect 542,000 workers by 2017.
“By 2019, we estimate that 609,000, or 41.3% of the covered workforce, will receive a wage increase from the proposed law,” the researchers wrote in March 2015. “Average annual earnings will increase by 30.4%, or $4,800 in 2014 dollars.”
While higher pay may lead to higher prices and to a drop in consumer spending, those who will get a pay raise thank to the new bill are more likely to spend more, according to the researchers.
These findings did not appease opponents of the $15 an hour minimum wage, who have said that the report is not independent. Since the institute conducted a similar study on the effects of increasing the minimum wage to $13.25 by 2017 as proposed by the Los Angeles mayor Eric Garcetti last year, the opponents felt that commissioning the institute to conduct this years study was a conflict of interest.
“I asked for an independent study. Selecting UC Berkeley again for this independent analysis does not pass the smell test with me,” city councilman Mitch O’Farrell said in January.
Both Seattle and San Francisco have populations of less than one million, whereas Los Angeles population is more than 3.88 million people. The effects of increasing the minimum wage to $15 an hour on that large of a scale remain unknown, which is something that continues to worry Los Angeles lawmakers.
“This is an experiment,” Paul Koretz said during Tuesday’s hearing. “If anyone tells you they know exactly how this is going to go … they’re not being honest with you.”
Despite concerns about the possible effects of increasing minimum wage to $15 an hour, two hours into Tuesday’s hearing, the proposal passed. Worker rights advocates declared the vote a win for the low-wage workers.
“By a vote of 14 to 1, the council directed L.A.’s city attorney to prepare legislation setting a $15 wage floor,” said Christine Owens, executive director of the National Employment Law Project. “Today, Los Angeles becomes the latest and largest city to throw its support behind the legions of workers who ask for nothing less than to be paid a fair and decent wage.”