California’s $15 minimum wage plan: What we know


SACRAMENTO, Calif. (AP) — California lawmakers on Thursday approved the nation’s highest minimum wage of $15 an hour to take effect in 2022.

Democratic Gov. Jerry Brown says he plans to sign the bill into law on Monday.

Brown negotiated the proposal with labor unions earlier this month, presented the final agreement to legislative leaders last weekend and publicly announced the plan on Monday.

The governor has opposed previous proposals to raise the minimum wage above $10 an hour but said he favors the current agreement’s staggered implementation and a provision that allows him to delay increases during economic or budgetary downturns.

WHAT WE KNOW

California’s plan will raise the minimum wage to $10.50 an hour on Jan. 1 then increase it to the next whole dollar amount in each of the subsequent five years. There are currently about 2.2 million Californians earning minimum wage, according to a legislative analysis.

WHAT PROPONENTS WANT IT TO DO

Unions and other supporters say the raises would lift low-income earners out of poverty and level out growing inequities among local minimum wages.

WHAT CRITICS FEAR IT WILL DO

Business groups and other opponents of the measure are concerned that unintended consequences, including layoffs and price increases, would outweigh benefits.

WHAT WE DON’T KNOW

It’s tough to predict the number of workers making more than minimum wage who will seek or receive increased pay after the figure is raised. One study by the University of California, Berkeley, Center for Labor Research and Education projected the ripple effect of a $15 minimum wage on those higher earners could raise pay for 5.6 million Californians by an average of 24 percent.

The proposed increase is so far above prevailing minimum wages across the states that there is little indication of how the move would affect overall employment or the economic stability California has enjoyed since climbing with the rest of the nation out of the recession.

HOW STATES COMPARE

In New York, Gov. Andrew Cuomo and state lawmakers continued to negotiate Thursday over Cuomo’s proposal to gradually raise the state’s minimum wage from $9 to $15 by the end of 2018 in New York City and by mid-2021 elsewhere in the state.

At $10 an hour, California and Massachusetts are currently tied for the highest minimum wages among states. Los Angeles, Seattle and other cities recently approved $15 floors. Oregon officials decided earlier this year to increase minimum wages to $14.75 an hour in cities and $12.50 in rural areas by 2022.

According to the National Conference of State Legislatures , statewide minimum wages in Wyoming and Georgia are $5.15 an hour — more than $2 below the $7.25 federal requirement.