Why do we need a minimum wage
increase in Pasadena?
Many Pasadenans earn low wages. Nearly one third of working Pasadena residents earn less than $15 per hour, despite working full-time, year round. About 15 percent of those employed in Pasadena earn less than $15 per hour.
Families aren’t making enough to get by. More than 17 percent of households in Pasadena live on less than $25,000 per year. An astounding 28 percent of households here spend more than half their income on rent.
Low wages are bad for the economy. When workers struggle to pay for the basics, like food and rent, they aren’t able to spend money at local businesses.
A higher minimum wage would create economy-boosting jobs. A $15 per hour Pasadena minimum wage would inject over $150 million per year into the economy; generate over 1000 new jobs; increase tax revenue; and reduce spending on the social safety net.
The time is right for Pasadena to raise the minimum wage. Both the City and County of Los Angeles have now passed legislation to move toward a $15 minimum wage.
To compete for the workers who will help Pasadena’s economy thrive, we can’t be leave our community behind. Instead of losing employees to higher wage locations, Pasadena employers will be able to retain their top workers – and save on the high cost of turnover. For employers with multiple locations throughout the county, one minimum wage will make things simpler.
What will the effects be on businesses and consumers?
Leading economists agree that businesses are unlikely to cut jobs. There is a strong consensus among economists – include multiple Nobel Laureates – that raising the minimum wage does not lead to decreases in employment, especially if the wage is raised
incrementally, as is proposed.
Businesses will adapt in the coming years, alongside their competitors. No business will be at a disadvantage; all will be required to comply. Wages will increase slowly over the next five years, allowing employers to adjust and experience the benefits of a stronger local economy. Most affected businesses will not realistically be able to leave Pasadena, nor will they need to.
Consumers are unlikely to see significant price increases. In the industry that is most likely to raise prices – fast food – consumers may see up to a 30 cents increase to a typical hamburger price. That’s a cost that’s easy to swallow when the benefits of increased wages are considered.
What is the proposal for Pasadena’s minimum wage increase?
The proposal from Pasadenans for a Livable Wage calls for a minimum wage ordinance closely resembling the Los Angeles City and County Ordinances.
Incremental wage increases. Increases would occur on the following schedule:
For employers with 26 or more employees:
July 1, 2016 $10.50
July 1, 2017 $12.00
July 1, 2018 $13.25
July 1, 2019 $14.25
July 1, 2020 $15.00
For employers with 25 or fewer employees:
July 1, 2017 $10.50
July 1, 2018 $12.00
July 1, 2019 $13.25
July 1, 2020 $14.25
July 1, 2021 $15.00
Cost of living adjustments. To avoid a situation like the present one, where the real value of the minimum wage has declined drastically over time, the City of Pasadena ordinance should increase the minimum wage according to the Consumer Price Index (CPI), beginning on July 1, 2022. Both the City of Los Angeles and L.A. County's plans include increasing the wage according to CPI; for ease of enforcement, consistency across neighboring jurisdictions makes sense.
An Inclusive law. Mirroring California’s minimum wage labor code, only workers who are family members, trainees, employees in State certified workshops for the disabled will be exempt from the minimum wage.