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LA City Council committee considers impact of raising minimum wage

Supporters of raising the minimum wage in Los Angeles rally outside L.A. City Hall in January of 2015
Brian Watt
Supporters of raising the minimum wage in Los Angeles rally outside L.A. City Hall in January of 2015

The Los Angeles City Council's Economic Development Committee held its first public hearing Tuesday on raising the citywide minimum wage. 

The council is considering proposals to raise the wage - currently at $9 an hour -  to  $13.25 by 2017, and to $15.25 by 2019.  

The committee began by hearing from economists who've worked onthree studiesof the impacts of a wage hike.  Committee members then asked a range of questions, from what happens if neighboring cities also raise their minimum wage, to what defines a small business, to how much will the working poor be hurt by businesses raising prices to cover the costs of paying employees more.   

Councilman Gil Cedillo asked a seemingly simple question:  how many jobs would the city lose if it proceeds with the minimum wage hike?  The answers weren't so simple:

Michael Reich of UC Berkeley's Labor Center said in raising the wage to $13.25 by 2017, the city would lose a total of 1552 jobs.

 "That would be 0.1 percent of all jobs in the city," said Reich, co-author of the study commissioned by city officials.  

Chris Thornberg, author of the report commissioned by the Los Angeles Area Chamber of Commerce, took a different approach.  His analysis focused not on the how many jobs would be "lost" but how many wouldn't be created.

"By our estimate, we expect the city to have about 150,000 new jobs over the course of the next five years," Thornberg told the committee. "We think raising the minimum wage just to $13.25 will reduce that growth to anywhere between 10,000 and 70,000 [jobs]." 

Dan Flaming of the Economic Roundtable, which conducted a study backed by the labor community, said it's difficult to calculate job loss into the future and said that city should develop tools to monitor it.  

As the Los Angeles City Council continues to study the wage hike, the Board of Supervisors for Los Angeles County has also begun to consider it.  On Tuesday, the Board voted in support of a proposal by Supervisors Mark Ridley Thomas and Hilda Solis to study raising wages for in home supportive services, or in-home care workers.  Supervisor Sheila Kuehl is also proposing that the board commission an analysis of a minimum wage hike in unincorporated parts of the county.