What does the City Council hope to accomplish by raising the minimum wage in Los Angeles?
The obvious answer is something along the lines of, “To lift full-time workers out of poverty.” But if that’s the goal, why is the council focusing on the wage and not the poverty?
I ask this in light of my colleague David Zahniser’s piece Monday about Homeboy Industries seeking a partial exemption from the mandate to pay no less than $15 an hour by 2020. Specifically, the nonprofit wants to exempt workers who spend no more than 18 months in its transitional employment program, which helps former gang members with a combination of on-the-job training and counseling.
Without the exemption, Homeboy warned, it would have to cut its program by more than a third, eliminating 60 of its 170 slots. Bear in mind that this is a transitional program, designed to impart job skills, create references and otherwise help participants go on to better jobs. No one is supposed to spend years in one of these positions, trying to eke out a living while raising a family.
Still, here’s what Councilman Curren Price told Zahniser: “Philosophically, I do not feel comfortable saying to transitional workers that, because they have faced challenges in their lives, they deserve to be paid less than every other worker in the city.”
That’s a fine sentiment for low-skill and entry-level jobs that, sadly, have become long-term occupations for many adult Angelenos. But it doesn’t make sense to apply that principle to a training program that’s designed to bring unemployable people into the workforce.
Put another way, improving the fortunes of 110 Homeboy Industries trainees for 18 months isn’t worth freezing out 60 others who need help just getting started. If your goal is to pull people out of poverty, why would you want to leave so many behind?
And as Zahniser noted, it’s not just Homeboy that’s at risk. There are a number of programs that combine on-the-job training and social services into a package designed to move people off welfare and into better lives. They’re typically funded by donors and, possibly, government grants, and they’re no-margin businesses with little ability to cover the huge increase in cost that the higher minimum wage represents.
The most galling aspect of this is the opposition from the L.A. County Federation of Labor, which was one of the driving forces behind the push for $15 and hour. The unions oppose any carve-outs to the higher wage, with one exception: any business that’s unionized.
Federation leader Rusty Hicks told Zahniser that such an exception could work for Homeboy too, if its workers could bargain collectively with management. “If those program participants had a say in what their wage would be, then that’s a different conversation,” Hicks said.
Setting aside the obvious hypocrisy of the federation seeking something for union members that it would deny everyone else, Hicks misses the point of training programs like the one Homeboy offers. The jobs being performed weren’t created to fill a demand in the market, they were created to provide a service to the workers themselves. That’s why groups such as Homeboy Industries have to raise countless dollars to keep the programs going.
I know, there are plenty of low-margin businesses in Los Angeles that say the higher wage floor will force them to eliminate positions too. City leaders, however, are putting their faith in studies that predict the higher wages will stimulate the local economy, leading businesses to create almost as many jobs as are lost, if not more. Of course, the jobs that are created won’t necessarily be filled by the people who get laid off. At any rate, the council is expected to approve the wage hike Wednesday with a one-year delay for very small workforces, and Mayor Eric Garcetti is expected to add his signature.
After initially proposing a waiver for transitional programs like Homeboy, the council decided last month to hold off on that pending further study. Whether unionized workforces are exempted from the higher wage remains to be seen.
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