Back in May, Los Angeles city council voted to pass a new law that would increase the minimum wage in the city to $15 per hour by 2020. Championed in particular by Eric Garcetti, various media outlets are declaring that the Mayor is leading the country in terms of wage reforms and immigration, as L.A. becomes the largest city to have undergone this kind of wage change.
Seattle and San Francisco have already taken similar steps, but what has been most interesting about the move is analyzing politicians reactions and discussion on whether such a move should also be nationwide.
Garcetti, whilst arguing for all the benefits of a higher minimum wage in L.A. (including attracting better workers and a lower employee turnover), does not advocate a similar change nationwide at this point. During a speech in Washington, he pointed to the different costs of living in different cities as a reason to be careful about implementing any sweeping wage reforms across the country, and whilst hinting that eventually the nationwide minimum wage would reach $15, he suggested different time spans would be required for this change to take place in different areas.
Hillary Clinton has been giving a similar response when asked on minimum wage issues, stating: “I think part of the reason that the Congress and very strong Democratic supporters of increasing the minimum wage are trying to debate and determine what’s the national floor is because there are different economic environments”. Seemingly, Clinton is in agreement with Garcetti that larger, more metropolitan areas are suited to a $15 minimum wage, but other areas may not be.
However, fellow Democratic candidate Martin O’Malley has spoken of ‘rebuilding the American dream’ – and a vital part of that, in O’Malley’s eyes, is raising the national minimum wage to $15 – in contrast to Clinton and Garcetti’s more conservative approach.
Already however there are those who doubt that even in the move in L.A. is a good idea. Some businesses have spoken about moving out of L.A. fearing that running costs would be too high now to turn a decent profit – the counter argument to this is that L.A. will attract and retain better workers – and that those workers in turn will spend more in the economy.
Which one of these theories will hold true is unclear, but it seems like certain types of businesses (where good workers can really make a difference) could even benefit from the move; where others may feel they’d have a better chance of turning profit elsewhere in the country. How this will change in the future as other areas implement similar rises in the minimum wage is anyone’s guess.
Let us know in the comments below your views on news that Los Angeles passes a new minimum wage law.