la's rise in minimum wage fuels mixed response
By Connor McGlynn
Estela Flores, 40, uses a visor and apron behind the cutting board because she is saving money to return to school and cannot afford to buy new clothes with her salary from making sandwiches at Subway.
For eight hours a week, the maximum her manager will schedule her for, Flores works at the Subway in Pico-Union on Hoover and Venice streets, tossing ingredients on rolls for $9 an hour, California’s current minimum wage.
Although the state’s wage is above the $7.25 an hour federal minimum wage, Flores does not believe that her salary allows her to fulfill some of the basic necessities she deserves.
“I plan on going to school next year so I can work on my English,” said Flores while struggling to find the correct words. “But I don’t know if $9 per hour will cover it.”
The Los Angeles City Council has been discussing a motion proposed by Los Angeles Mayor Eric Garcetti to increase the city’s minimum wage to $13.25 an hour by 2017, and have talked about potentially going beyond that rate.
Estela Flores, 40, uses a visor and apron behind the cutting board because she is saving money to return to school and cannot afford to buy new clothes with her salary from making sandwiches at Subway.
For eight hours a week, the maximum her manager will schedule her for, Flores works at the Subway in Pico-Union on Hoover and Venice streets, tossing ingredients on rolls for $9 an hour, California’s current minimum wage.
Although the state’s wage is above the $7.25 an hour federal minimum wage, Flores does not believe that her salary allows her to fulfill some of the basic necessities she deserves.
“I plan on going to school next year so I can work on my English,” said Flores while struggling to find the correct words. “But I don’t know if $9 per hour will cover it.”
The Los Angeles City Council has been discussing a motion proposed by Los Angeles Mayor Eric Garcetti to increase the city’s minimum wage to $13.25 an hour by 2017, and have talked about potentially going beyond that rate.
Residents throughout the city gather to show their support for increasing the wages to a livable level (Time.com)
"I'm proposing to responsibly and gradually raise the minimum wage in L.A. to $13.25,” Garcetti said.
“It's deplorable and bad for our economy to have one million Angelenos stuck in poverty, even when working full time.”
District 1 Councilman Gilbert Cedillo, who represents Pico-Union, co-wrote a proposal with three other councilmen to increase the minimum wage to $15.25 by 2019.
“This motion is the first step in improving the quality of life for all working families who continue to struggle to make ends meet in my district and across all of Los Angeles,” said Cedillo in a statement.
“I am hopeful that we can achieve this with no job loss and adequate protection for small business.”
Pico-Union’s median household income in 2011 was $27,294 compared to the $46,148 median for the rest of Los Angeles, with 35 percent of the population living below the poverty level, nearly 13 percent more than the rest of the city, according to Urban Mapping.
The neighborhood, lined with fast food establishments and graffiti covered walls, has historically been deprived of economic success and industrial boom, as the poverty rate was twice the city average in 1990, according to the United States Census Bureau
“It's deplorable and bad for our economy to have one million Angelenos stuck in poverty, even when working full time.”
District 1 Councilman Gilbert Cedillo, who represents Pico-Union, co-wrote a proposal with three other councilmen to increase the minimum wage to $15.25 by 2019.
“This motion is the first step in improving the quality of life for all working families who continue to struggle to make ends meet in my district and across all of Los Angeles,” said Cedillo in a statement.
“I am hopeful that we can achieve this with no job loss and adequate protection for small business.”
Pico-Union’s median household income in 2011 was $27,294 compared to the $46,148 median for the rest of Los Angeles, with 35 percent of the population living below the poverty level, nearly 13 percent more than the rest of the city, according to Urban Mapping.
The neighborhood, lined with fast food establishments and graffiti covered walls, has historically been deprived of economic success and industrial boom, as the poverty rate was twice the city average in 1990, according to the United States Census Bureau
This sign sitting outside City Hall displays what the public wants to all city officials (LATimes)
Surrounded by poverty throughout Pico-Union, Cedillo acknowledged that although minimum wage needs to be raised in order to change the economic standing, it is a fragile state to alter.
“You got to do that thoughtfully so people don’t lose their jobs because raising the wages with losing jobs doesn’t make sense,” Cedillo said in his proudly self-furnished office, avoiding unnecessary expenditures.
Finding employment in Pico-Union, and District 1, has been inconsistent, with about 100,000 jobs lost from 2008 to 2009 and an increase-decrease flow since, according to the Los Angeles Area Chamber of Commerce Employment Development Center.
Although a study conducted by the University of California, Berkeley that Cedillo’s proposal is strongly focused around stated that the increased minimum wage would have a negligible impact on business operating costs and consumer prices, people within Pico-Union disagree.
“I don’t think increasing the minimum wage is going to do any good for this economy. It’s at the point where people are making money and owners and managers cannot afford that,” said Luke Song, owner of two Mega Paint Inc. stores.
“It’s just going to make matters worse. They should wait until the economy gets better before they raise the minimum wage because then at least there is money to go to the workers.”
Song, 48, has owned the businesses for 16 years, one in Pico-Union and the other in Orange County, and said that he recently fired all of his workers because there is not enough work and he doesn’t have enough money to cover their current minimum wage salaries.
“Right now everyone is trying to find jobs, especially the older people and the younger people,” Song said.
“There just isn’t enough money to go around and no one is hiring because we can’t afford to pay them. Raising the minimum wage would be a horrible thing.”
Brendan Kim, manager of Garden Liquor Store at Washington Boulevard and Orchard Avenue, believes that $9 an hour is not a livable wage, but speculates that increasing the rate will not make a difference.
“Everything is going up in price, so raising the wage won’t do much. It’s the entire economy and community,” Kim said.
Because the prices of materials required to live continue to rise, such as the cost of food, shelter and clothes, residents of Pico-Union have been unable to allocate money into areas that may solve the issue, like education.
“I couldn’t go to college. You gotta have money for that. Gotta have money to live,” said Jose Goldman, 27, who works at a cell phone stand at the intersection of 20th and Hoover streets. “I needed a job for that type of money.”
The Los Angeles City Council passed a law in September that will increase the minimum wage for workers in hotels of more than 300 rooms to $15.37 an hour by July 2015 and the same rate for hotels of 150 rooms by July 2016.
Only non-unionized hotels will be subject to the pay requirements and those that are facing financial troubles will have the ability to apply for waivers that will exempt them from the policy.
With the hotels being a microcosm for Pico-Union, similar arguments arose from business groups that the increased wages will only result in job losses and decreased service, while workers believe it will improve their quality of living.
“As a worker, of course you always want the higher wage, but as we begin to learn more about the economy and understand it more, I understand that you can’t go about paying them or having that wage,” Song said. “There’s just not enough money to go around.”
In the fast food industry, a field that heavily populates Pico-Union via McDonald’s and Burger Kings, 89 percent of workers nationally held positions such as cashiers and cooks while earning a median hourly wage of $8.94 in 2013, according the National Employment Law Project.
“It’s really hard for me to decide between paying my rent and paying my bills and buying my little boy his diapers,” said Maribel Ponce, a single mother with two children that works at McDonald’s. “If I don’t pay my rent, I leave my kids without a home and if I don’t buy his diapers, I leave my boy without his needs.”
Edgar Gonzalez also works at McDonald’s and believes that the minimum wage that he currently receives does not allow him to provide for his 7-month-old child.
“I want a better future for my daughter especially. I want to get paid a better wage because I think I work too hard,” Gonzalez said. “I work a lot, and then working two jobs and still not making ends meet, I don’t think it’s fair.”
Managers from several of these businesses in Pico-Union declined to comment on effects that an increased minimum wage could have on the companies, but multiple reports mention establishments may replace workers with automated machines as a result.
David Neumark, an economics professor and director of the Center for Economics and Public Policy at the University of California, Irvine, studies the effects that raising the minimum wage will have on its targeted population.
“The desire to help poor and low-income families is understandable,” Neumark wrote in the Wall Street Journal. “But increasing the minimum wage is a misguided way to do it.”
Neumark’s research has shown that while raising the minimum wage may appear to assist low-income families, it only helps low-wage workers and of these workers, only about 21 percent come from low-income families.
“The balance between winners and losers, coupled with the distribution of these winners and losers across low-income and higher-income families, results in no net change in poverty from a higher minimum wage,” Neumark wrote in the New York Times.
Instead of using an increased minimum wage to decrease poverty, Neumark emphasizes the importance of a reformed earned-income tax credit that specifically targets low-income families with employed workers.
Although the national minimum wage has not changed since 2009, the earned-income tax credit has been altered to allow for higher refundable tax credit, up to 40 percent of an individual’s income, according to Neumark.
With Pico-Union’s median income almost $20,000 less than the city’s median and the average household consisting of more than three people, the city council could make a bigger impact on the poverty by improving the EITC, according to Urban Mapping.
However, until Cedillo and the rest of the councilmembers are able to reach an agreement on the city’s minimum wage, Pico-Union residents like Flores will continue to be deprived of better opportunities.
“I think $15 an hour would be better,” Flores said reluctantly. “I mean I definitely need más, but that would be a good start.”
“You got to do that thoughtfully so people don’t lose their jobs because raising the wages with losing jobs doesn’t make sense,” Cedillo said in his proudly self-furnished office, avoiding unnecessary expenditures.
Finding employment in Pico-Union, and District 1, has been inconsistent, with about 100,000 jobs lost from 2008 to 2009 and an increase-decrease flow since, according to the Los Angeles Area Chamber of Commerce Employment Development Center.
Although a study conducted by the University of California, Berkeley that Cedillo’s proposal is strongly focused around stated that the increased minimum wage would have a negligible impact on business operating costs and consumer prices, people within Pico-Union disagree.
“I don’t think increasing the minimum wage is going to do any good for this economy. It’s at the point where people are making money and owners and managers cannot afford that,” said Luke Song, owner of two Mega Paint Inc. stores.
“It’s just going to make matters worse. They should wait until the economy gets better before they raise the minimum wage because then at least there is money to go to the workers.”
Song, 48, has owned the businesses for 16 years, one in Pico-Union and the other in Orange County, and said that he recently fired all of his workers because there is not enough work and he doesn’t have enough money to cover their current minimum wage salaries.
“Right now everyone is trying to find jobs, especially the older people and the younger people,” Song said.
“There just isn’t enough money to go around and no one is hiring because we can’t afford to pay them. Raising the minimum wage would be a horrible thing.”
Brendan Kim, manager of Garden Liquor Store at Washington Boulevard and Orchard Avenue, believes that $9 an hour is not a livable wage, but speculates that increasing the rate will not make a difference.
“Everything is going up in price, so raising the wage won’t do much. It’s the entire economy and community,” Kim said.
Because the prices of materials required to live continue to rise, such as the cost of food, shelter and clothes, residents of Pico-Union have been unable to allocate money into areas that may solve the issue, like education.
“I couldn’t go to college. You gotta have money for that. Gotta have money to live,” said Jose Goldman, 27, who works at a cell phone stand at the intersection of 20th and Hoover streets. “I needed a job for that type of money.”
The Los Angeles City Council passed a law in September that will increase the minimum wage for workers in hotels of more than 300 rooms to $15.37 an hour by July 2015 and the same rate for hotels of 150 rooms by July 2016.
Only non-unionized hotels will be subject to the pay requirements and those that are facing financial troubles will have the ability to apply for waivers that will exempt them from the policy.
With the hotels being a microcosm for Pico-Union, similar arguments arose from business groups that the increased wages will only result in job losses and decreased service, while workers believe it will improve their quality of living.
“As a worker, of course you always want the higher wage, but as we begin to learn more about the economy and understand it more, I understand that you can’t go about paying them or having that wage,” Song said. “There’s just not enough money to go around.”
In the fast food industry, a field that heavily populates Pico-Union via McDonald’s and Burger Kings, 89 percent of workers nationally held positions such as cashiers and cooks while earning a median hourly wage of $8.94 in 2013, according the National Employment Law Project.
“It’s really hard for me to decide between paying my rent and paying my bills and buying my little boy his diapers,” said Maribel Ponce, a single mother with two children that works at McDonald’s. “If I don’t pay my rent, I leave my kids without a home and if I don’t buy his diapers, I leave my boy without his needs.”
Edgar Gonzalez also works at McDonald’s and believes that the minimum wage that he currently receives does not allow him to provide for his 7-month-old child.
“I want a better future for my daughter especially. I want to get paid a better wage because I think I work too hard,” Gonzalez said. “I work a lot, and then working two jobs and still not making ends meet, I don’t think it’s fair.”
Managers from several of these businesses in Pico-Union declined to comment on effects that an increased minimum wage could have on the companies, but multiple reports mention establishments may replace workers with automated machines as a result.
David Neumark, an economics professor and director of the Center for Economics and Public Policy at the University of California, Irvine, studies the effects that raising the minimum wage will have on its targeted population.
“The desire to help poor and low-income families is understandable,” Neumark wrote in the Wall Street Journal. “But increasing the minimum wage is a misguided way to do it.”
Neumark’s research has shown that while raising the minimum wage may appear to assist low-income families, it only helps low-wage workers and of these workers, only about 21 percent come from low-income families.
“The balance between winners and losers, coupled with the distribution of these winners and losers across low-income and higher-income families, results in no net change in poverty from a higher minimum wage,” Neumark wrote in the New York Times.
Instead of using an increased minimum wage to decrease poverty, Neumark emphasizes the importance of a reformed earned-income tax credit that specifically targets low-income families with employed workers.
Although the national minimum wage has not changed since 2009, the earned-income tax credit has been altered to allow for higher refundable tax credit, up to 40 percent of an individual’s income, according to Neumark.
With Pico-Union’s median income almost $20,000 less than the city’s median and the average household consisting of more than three people, the city council could make a bigger impact on the poverty by improving the EITC, according to Urban Mapping.
However, until Cedillo and the rest of the councilmembers are able to reach an agreement on the city’s minimum wage, Pico-Union residents like Flores will continue to be deprived of better opportunities.
“I think $15 an hour would be better,” Flores said reluctantly. “I mean I definitely need más, but that would be a good start.”