The second hearing focused on the economic impact to Sacramento and what other cities in and outside of California have done so far. A research presentation was made by UC Berkeley Labor economist Michael Reich on the impact of $13.50 by 2019 in Sacramento City. This figure was requested to be researched by the local “Raise the Wage” campaign. City Councilman Jay Schenirer’s chief of staff also made a presentation about what other cities that have increased minimum wage have done, the phase in periods and exemptions. There was specific discussion of other states having total compensation and tip credit models.
As expected, the research summary presented by Berkeley showed little to no impact on jobs, prices or small business. Predictions show that prices will raise less than 2 percent each year, automation is unlikely and that increased wages will actually create jobs, not cause job loss. Local restaurateurs painted a different picture; however, citing cut hours, job loss and much higher prices in response to a $13.50 minimum wage.
CRA President + CEO Jot Condie, who sits on the Task Force, publicly noted the fall out in other cities including higher prices, lost jobs and business closures as real examples of increased minimum wage rates. Sacramento Metro Chamber President Peter Tateishi, also questioned the economist’s research and recommendation, highlighting that the study was specifically requested by the “Raise the Wage” campaign and studied an increase to $13.50, though no formal proposal has been made.
The CRA's Sacramento lobbyist, John Kabateck, told the Task Force that Sacramento's business community (Keep Sacramento Working) deserves a responsible and reasonable approach to any minimum wage increase - an approach which takes small businesses, jobs and Sacramento's economic competitiveness into consideration. Citing real impacts from other regions and highlighting that Sacramento City is surrounded by more than 30 cities, putting businesses inside the city limit at a competitive disadvantage. John also cited examples of employees in Seattle voluntarily cutting hours to maintain an income low enough to qualify for public assistance.
The next Task Force hearing will take place Wednesday, August 12, from 4-6 p.m. at Sacramento City Hall. This hearing will focus on the exemptions, impact to small business and again take public comment. Specifically, CRA will be pushing for a total compensation model and teen wage. CRA has also commissioned an economist to dissect the Berkeley study and present his findings.
If you are a CRA member, restaurant owner or friend of the industry, your presence at these hearings is critical! Please make it a priority to attend these final two meetings on August 12 and August 26. Please share this event with friends inside and outside of the industry that have minimum wage employees. This affects us all. Your presence is important at each hearing - even if you are not willing to speak. Register here today!