California Minimum Wage Laws​​

As political pressure builds to increase the minimum wage for all, individuals have discussed the economic impacts that an increased minimum wage may have on California’s economy.

According to the Congressional Budget Office, increasing the minimum wage is a double-edged sword. Raising the minimum wage would increase the incomes of most low-wage workers and lift many families out of poverty, but it would also cause other low-wage workers to lose their jobs and potentially struggle to provide for their families.

An increase in the minimum wage would raise the cost of employing low-wage workers, causing some employers to employ fewer workers. The impact of businesses facing an increase in the cost of labor could ripple across several industries and even leave certain people out of work indefinitely.

An analysis conducted by Berkeley’s IRLE Institute examined the potential effects of increasing the minimum wage in California and, specifically, Fresno.

They found that increasing the minimum wage to $15 by 2023 would:

• Boost earnings for 5.26 million workers (38 percent of California’s workforce)
• Increase annual pay among those receiving raises by 25.4 percent
• Provide raises to private-sector workers in California, including restaurant, retail, and health-service workers
• Provide an increase in employee productivity and reduce employee turnover
• Cause businesses to increase the costs of their products due to increased cost of labor

Suffice it to say, the situation is complex, especially with the large state economy of California. There are both positive and negative aspects that come from steadily increasing the minimum wage, and the state should be prepared to tackle these challenges as they arise.