California Minimum Wage May Jump 25%

California has made progress in bringing down the unemployment rate. June’s seasonally adjusted unemployment rate of 8.5 percent is the lowest since October 2008, according to California Employment Development Department data. Unemployment reached 12.4 percent during the Great Recession, and for much of the past five years it’s been in double digits, including as recently as last October.

While the downward trend has been encouraging, California’s unemployment is still 12 percent higher than the national average of 7.6 percent. And much of the rural area of the state remains at Great Depression levels of unemployment: Imperial County 23.6 percent, Colusa County 15.8 percent, Sutter County 14.7 percent, Merced County 14.1 percent, Yuba County 13.6 percent. In addition, 23 other counties are still suffering double-digit unemployment, including Los Angeles.

Unfortunately, California’s unemployment rate could be headed back up if a bill significantly increasing the $8 state minimum wage is passed this year. Assembly Bill 10 by Assemblyman Luis Alejo, D-Salinas, would increase it by 25 percent in increments over the next five years: $8.25 per hour starting Jan. 1, 2014, $8.75 in 2015, $9.25 in 2016, $9.50 in 2017, $10 in 2018.

Alejo’s mostly agricultural 30th Assembly District is comprised of cities with high unemployment rates: Gonzales 15.8 percent, King City 13.8 percent, Greenfield 12.8 percent and Salinas 11.5 percent.

Jobs lost when minimum wage increases

Ironically, hundreds of Alejo’s currently employed constituents and thousands more throughout California could be out of a job if his bill passes, according to opponents of minimum wage hikes. The Employment Policies Institute lists the potentia.l damage:

• For every 10 percent increase in the minimum wage, teen employment at small businesses decreases by 4.6 to 9 percent.
• Only 16.5 percent of minimum wage recipients are raising a family on a single income. The rest are teenagers living with working parents, adults living alone, or dual-earner married couples.
• There were 550,000 fewer part-time jobs as a result of the 40 percent federal minimum wage increase between July 2007 and July 2009, according to a Ball State University study.=

Via: California Political Review

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