The City Council's decision Tuesday to raise the minimum wage to $15 in Los Angeles was hailed as a major step toward easing the strain of poverty among the city's low-wage workers. And it may well be. The state's current minimum wage of $9 an hour just isn't enough to live on in a high-cost city. The new wage, which will be increased annually until it reaches $15 in 2020, will give some 800,000 men and women a raise that will help them cover the expenses of housing, food, transportation and other essentials.
But what will really help struggling Angelenos is more jobs that pay higher than the minimum wage, and more opportunities to move up the career ladder. L.A. needs more $20- and $30-an-hour jobs that truly lift people out of poverty and provide a larger tax base to pay for the services and infrastructure that improve the city's quality of life. Without growth in higher-wage jobs, L.A. has done nothing but make itself more attractive to low-wage workers and less attractive to businesses that would hire them.
It was quite evident even before Mayor Eric Garcetti proposed raising the minimum wage that mandating a pay hike isn't enough to solve L.A.'s poverty problem. The mayor and the City Council should be doing everything possible to attract and retain businesses that provide solid middle-class jobs.
Yet eight months after Garcetti's initial proposal, we're still waiting for city leaders to articulate a clear, comprehensive strategy for job creation. There are various efforts and some successes, but not a citywide vision for economic development that is embedded in the city budget and ingrained in every department's mission. (The closest version is Garcetti's recently released sustainability plan, which sets targets for creating “green jobs.”) We're still waiting to see how L.A. is going to help create more housing, which is essential because companies won't expand here if their workers can't afford to live here.
And we'd like to see a plan for how the city can assist industries and employers that struggle with the transition to the higher minimum wage. The pay hikes are unprecedented in size and scale, and nobody can predict how employers or the city's economy will respond. The business community has raised serious concerns that they will slow hiring and job creation and hinder L.A.'s economy. That is a risk. Since the depth of the recession in June 2009 to March of this year, L.A. has had slower job growth (8.6%) than San Francisco (20%) and Seattle (11%) — two cities that also adopted the $15 minimum wage.
The mayor and City Council should make sure that when they adopt the final minimum wage ordinance in June, they're also creating tools to preserve existing jobs and increase the number of better-than-minimum-wage jobs.