Garcetti Wage Hike Plan Not Playing Well With Business

By City News Service

Los Angeles business leaders said Tuesday they were troubled by a proposal being shopped by Mayor Eric Garcetti that would raise the minimum wage in Los Angeles to $13.50 an hour by 2017.

Garcetti has been shopping a plan to area business groups that would raise the minimum wage from the current $9 an hour by $1.50 annually for the next three years, after which the wage would be tied to the cost of living.

The plan would be a “death blow for some businesses,” according to Stuart Waldman, president of the Valley Industry and Commerce Association.

“This is incredible that the mayor would even consider this in this economy,” Waldman said.

“We are losing businesses, which are moving out of the city in droves. This will only further activate the flight of businesses and jobs (from) Los Angeles.”

Members of the Los Angeles Area Chamber of Commerce were also “unenthusiastic” when they were briefed about the proposal, chamber President Gary Toebben said.

The recently instituted statewide hike that raised the minimum wage to $9 and will increase it to $10 by 2016 “will have less of an impact” than a hike for an individual city, Toebben said.

A city wage increase “doesn’t impact the other 6 million people in the counties, city and other regions around us,” he said.

The two business groups represented by Toebben and Waldman have not taken official stances on a minimum wage proposal. VICA is expected to discuss it later this week, while Toebben said LA Area Chamber of Commerce leaders are collecting feedback from members.

The mayor’s office would not confirm the specifics of the proposal, but mayoral aide Jeff Millman said officials have been meeting with business leaders, as well as “labor, community and faith leaders” to talk about “ways to help L.A. families and our economy thrive.”

One of the mayor’s goals is to “lift Angelenos out of poverty,” he said.

Connie Llanos, an aide for Councilman Curren Price, who has suggested that a citywide minimum wage hike be instituted, said “we’re excited” to have a “conversation” about poverty in Los Angeles.

“We’re ready for it,” she said.

The council has been working on a plan to increase the minimum wage to $15 an hour at large hotels.

Councilman Mike Bonin, who has spearheaded the effort, said if the mayor were to officially come out with a proposal, he would “embrace it, welcome it, champion it and do everything I could to get it passed by the council.”

“I’d also say if the mayor does propose it, I think it will get a lot of support among the City Council and it will have broad-based support from labor, business, faith, communities and political leaders,” he said.

Bonin noted that he has heard support for raising the minimum wage from several people in the business community, adding that he has also been discussing “various strategies to reduce business taxes” with the mayor.

Businessman and philanthropist Eli Broad also threw his support behind raising the minimum wage citywide, saying “if Los Angeles is to maintain our standing as a world-class city, we need to increase the minimum wage.”

“Raising the minimum wage would help lift people out of poverty and stimulate our local economy,” he said.

Broad and fellow businessman Rick Caruso earlier this year voiced support for a gradual minimum wage hike to $15 an hour.

The $13.50 minimum wage plan also drew support from Maria Elena Durazo, executive secretary-treasurer of the Los Angeles County Federation of Labor, AFL-CIO.

Her group is pushing for the $15 minimum wage for hotel workers.

“I’m very glad to hear the mayor would be interested in increasing the minimum wage,” she said. “We’ve been working on increasing wages. We know that there has been a tremendous growth of poverty wage jobs.”

A group of activists is also hoping to get an initiative on the ballot to raise the minimum wage to $15 for all workers in the city.

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August 28, 2014  Copyright © 2012 Eastern Group Publications, Inc.

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