California Minimum Wage Workers Demand $20 Wage Increase

Now, one month into the wage bump, other workers want a taste of the pay increase too, feeling they also deserve more money.

The minimum wage in California is $16 an hour for most workers, a full $4 less than what those working in certain industries like fast food are able to make.

A California Legislative Analyst’s Office analysis from March found that prices have grown about 20% in the state since 2020. Inflation levels in California are higher than the average rate in the rest of the country.

According to the San Diego Union-Tribune, California’s fast-food prices rose 7% just before the new $20 minimum wage took place and California full-service restaurants have raised prices by 3.3% in the past six months.

This is composed of industry representatives and restaurant workers, who have been authorized to hike this wage further by 3.5% annually based on inflation. They can also advise on health and safety standards and deal with issues such as wage theft.

“I would like to make that,” Harris said of the $20 minimum wage. “Sixteen dollars an hour is definitely not enough if you’re trying to support a family.”

This comes after union and labor groups have suggested that an increase to $20 an hour isn’t enough for people to live off.

“Clearly, the Legislature understands that some workers deserve $20, so they must understand that everybody deserves $20,” said Saru Jayaraman, president of One Fair Wage, a national organization calling for higher salaries in the service sector.

Child-care providers, school staff, retail workers, and restaurant workers bring in some of the lowest wages in California, and there may be an exodus to $ 20-an-hour jobs that could increase staffing shortages in other industries.

If this doesn’t happen, especially if it doesn’t happen soon, more staff are going to leave these sectors and bosses are going to struggle to come up with ways to retain and hire staff.

“There’s no way around raising wages at this moment. People are just saying, ‘I cannot afford to do this anymore,’” Jayaraman said. “If you see every other price go up and the wages have not, you’re going to end up with massive staffing crises in every low-wage sector.”

West Hollywood currently pays the most at $19.08. However, Oakland pays the least at $16.50. In some places, pay also depends on whether they live in the City or outside it. For example, the city of Los Angeles pays $16.78, whereas the unincorporated county of Los Angeles, in Santa Monica and Malibu, pays $16.90.

29% are under 25, and 27% are aged 50 or older. In comparison, workers aged between 25 and 49 make up between 7% and 12% of minimum wage workers within their age categories.

If it receives enough yes votes, it will increase the state minimum wage to $18 for all employees by 2026 and will increase the minimum wage annually based on any increase to the cost of living.

The current minimum wage in California equals about $33,000 per year, but the cost of living in the state comes out to about $53,082 every year according to federal data.

With millions of workers in the Golden State now wanting a minimum wage increase, there are some questions as to how the state is going to manage these increases when it is trying to cut costs.

This deficit is currently at $37.9 billion. Newsom is trying to find ways to reduce this benefit, which means cutting down on spending. Raising wages does the opposite of this.

Last week, unions in San Diego representing hotel workers introduced a campaign to fight for $25 an hour.

“We can’t expect the business community to continue to absorb this time and time again,” said Republican Assemblymember Heath Flora. Flora has heard resentment from constituents that they were excluded from the $20 wage hikes because they “don’t have a powerful labor group or lobbyist” backing them up.

However, there are also some pros. For example, these businesses will be able to see an increase in the number of employees they have, especially the ones who want to stay.

While workers may not struggle as much as they once were with new wage increases, it will leave businesses struggling.

Two Pizza Hut franchises in California laid off more than 1,000 delivery drivers. They are now relying on individually contracted delivery drivers to do their jobs instead.

In April 2024, Excalibur Pizza, which is a franchisee of Round Table Pizza, laid off 73 delivery jobs, which make up 21% of its workforce. This also shows that delivery drivers seem to be the ones taking the brunt of the layoffs.

This will only increase the amount of people who are unemployed in the Golden State, and offers increased pressures for those trying to afford to live here.

This adaptation is crucial for maintaining competitiveness and profitability in a state known for its diverse economy.

The shift is particularly evident in Silicon Valley, where tech giants are leading the way in adopting these advanced technologies, setting a precedent that could spread across other industries.

These changes are critical in maintaining the delicate balance between productivity and cost, ensuring that California remains a leading agricultural state.

With increased wages, there’s a growing inclination towards using automated assembly lines to cut costs and improve precision. This evolution in manufacturing techniques could redefine the sector’s role in California’s economy.

The potential shift in consumer behavior could impact businesses’ pricing strategies, supply and demand dynamics, and overall economic stability.

This increase is a welcome change for businesses but also poses questions about long-term consumer spending sustainability.

This sensitivity is prompting a more cautious approach to spending, with many opting for budget brands or discount options.

More individuals are considering vocational training and higher education paths that align with industries offering higher wages.

Technical schools offering courses in healthcare, technology, and skilled trades are particularly popular, reflecting the job market’s demands. This trend shows a shift towards practical, employment-oriented education.

Universities and colleges are adapting their curricula to meet this demand, focusing on degrees that offer a clear path to financial stability.

While higher wages can provide immediate relief for low-income workers, there is concern that businesses may struggle to keep up with rising labor costs. There’s also the risk of wage inflation, where prices increase to match higher wages, leading to a cycle of continuous increases.

This complex scenario presents a critical moment for policy-makers and business leaders as they navigate these uncertain waters.