Governor Brown finalizes CA minimum wage increase

Apr 5, 2016 10:55 AM by News Staff

It's official.

Governor Jerry Brown signed legislation into law that that will raise California’s minimum wage to $15 an hour over the next six years.

It'll go up gradually, $10.50 an hour in January then $11 an hour the next year and then another dollar per year until 2022 when it reaches the $15 mark.

Governor Brown said California’s fast-growing economy can absorb the raises.

"Fifteen dollars will mean that I and my husband will be able to get a bigger apartment and my kids will have their own room,” said a minimum wage worker who spoke at the press conference. “I will not depend on public assistance, like first time America."

State senator Mark Leno said the increase is about more than just getting more money into people’s pocket.

"If there's no reward there's really no respect,” he said. “And there's absolutely no reward for working a full time job and living in poverty with any hope of every getting out of it."

But republicans and business groups warn that it could cost thousands of jobs.

Governor Brown said minimum wages might not make sense economically but that, "morally and socially and politically they make every sense."

But will the minimum wage hike will be good for California’s economy?

Reporters paid Chico State a visit yesterday to talk to Professor Michael Perelman, who specializes in the economy and has been teaching economics at Chico State for 45 years.

Perelman said while there's a downside to the increased wage the upside will probably win out.

With Governor Jerry Brown signing off on legislation to increase California’s minimum wage to $15 an hour by 2022, it raises the question how will the higher wages effect the business climate in the state?

Business groups and republicans who were against the increase have argued it will end up costing people their jobs.

“Because what happens is when you increase minimum wage, people have more money to spend and that creates more jobs,” Perelman said.

Perelman points out this doesn't mean the sky is the limit for minimum wage hikes. He believes a strong economy is built on balance and advanced technology that can create new industries.

The numbers show full-time minimum wage workers will see their annual earnings jump by $10,000 when the hike reaches the $15 per hour plateau.


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