Should California have a $18 minimum wage? Voters may get to decide

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California voters can decide whether the state minimum wage goes up to $18 an hour, at a time when rising prices and the cost of living are eating away at workers’ household incomes.

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Los Angeles investor and anti-poverty activist Joe Sanberg pioneered the 2022 Living Wage Act, which was filed Friday with the state attorney general’s office. Sanberg said he would finance the signature-gathering process to qualify the ballot initiative for November’s election. It will gradually increase the state minimum wage from 2023, then increase to $18 an hour by 2026 for businesses of all sizes.

The current minimum wage is due to reach $15 an hour for large businesses starting in January and for all occupations by 2023. The state minimum is now $14 per hour for businesses with 26 or more employees and $13 per hour for small businesses.


“If you work full-time, you should be able to live with complete financial security, and that’s not the case in California,” Sanberg said in an interview. “We were a leader in pushing for a $15 minimum wage, but now we have to take the ball back and forth. It’s overdue for $18.”


He said the time is right to push for a higher minimum wage as the pandemic highlights how many Californians are working full-time jobs that still can’t meet basic needs.

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Sanberg made his fortune on Wall Street and then moved to invest in start-ups, which include food preparation company Blue Apron.

He’s well-known in Sacramento, having coaxed legislators in 2015 to create a California version of the earned income tax credit—a program that has been expanded in recent years to help more low-income residents. He founded a non-profit to launch an advertising campaign to ensure that deserving people get their money.

He is also the co-founder of Aspiration, an online banking service that allows customers to choose their own fees.

While it is rare for wealthy Californians to personally control all the costs involved in an initiative signing campaign, it has happened occasionally over the years.

And under state election law, Sanberg could stay there—choosing to withdraw his motion once it qualifies for the ballot if MP and Governor Gavin Newsom passes similar legislation on his own next year. agree to do.

The initiative would mandate that businesses with 26 or more employees increase base pay by a dollar each year until it reaches $18 per hour in 2025. Small businesses with 25 or fewer employees will have an additional year to reach the minimum $18.

According to the initiative, after reaching $18 an hour, the minimum wage will be adjusted annually to keep pace with the cost of living.

California’s current gradual increase to $15 an hour was the result of a bill signed in 2016 by then-California Gov. Jerry Brown. The law, which went into effect in 2017, steadily increased the minimum wage to $15 an hour each year. In 2016, the minimum wage for all occupations was $10.

Ken Jacobs, president of the UC Berkeley Labor Center, said the $15 hourly wage increase has had a “real, measurable impact on workers’ wages in the state.” The move to the U.S. would result in a wage increase, with an increase in average annual income per capita by $3,700.

Jacobs said that by the time the minimum wage reaches $15 an hour, it would equate to more than $20 billion annually in wage increases, which is more than the combined value of all of the state’s major public assistance programs.

Nevertheless, “it was still a significant increase but … the cost continues to rise,” he said. “It’s also important to note that, especially with the rising cost of housing in California, even in our major cities, $15 is still not enough.”

Advocacy group United Ways of California calculated that a family of four — two adults, a preschooler and a school-aged child — living in Los Angeles County would need to make an annual income of $95,112 to meet basic needs. This calculation, known as the actual cost measure, is based on publicly available data on expenses such as housing, food, health care and child care.

The high cost of living in California is one of the main reasons why Sanberg and others are advocating for an $18 per hour minimum wage.

Sanberg said the minimum wage should now be $24 if it has increased in line with the increase in worker productivity since 1960.

The fact that the state base wage is a year away from $15 an hour “doesn’t mean it’s the true minimum wage,” he said. “Work will happen when everyone who works full time can meet the basic necessities of life.”

Times staff writer John Myers contributed to this report.

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