Income gap

Dueling SF minimum wage increase measure headed for November ballot unless labor and business leaders can compromise on one

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news@sfbg.com

It seems like San Francisco may surpass itself as the city with the highest minimum wage in the country, as labor activists and business groups are each pitching their own fall ballot measures to raise wages for the lowest paid workers.

The city's current minimum wage of $10.74 is the highest in the country, but that still isn't enough, according the labor activists, not in the city with the most expensive rent in the US and one of the largest income gaps.

"We have the highest growing gap between the rich and the poor, and the economic disparity is so high right now," said José Argüelles of Young Workers United. He said the raising the minimum wage "isn't the whole solution, but it's part of it. Folks working full time in San Francisco should be able to afford to live in San Francisco."

But sometimes even working full time in San Francisco isn't enough to live here. A 2012 study by the San Francisco Department of Health found that even in the most inexpensive neighborhoods of the city, one would have to work 3.4 full-time minimum wage jobs to afford rent in a two-bedroom market rate apartment. In the priciest neighborhoods, one would have to work up to eight full-time jobs to afford rent.

All of this is occurring at a time when minimum wage debates are taking place across the country. President Obama has suggested raising the federal minimum wage from the current $7.25/hour to $10.10/hour, although Congress has been less receptive. Here in California, the state minimum wage of $8/hour will rise to $9/hour this July, and $10/hour by 2016.

The San Francisco ballot measure favored by labor activists is an initiative to raise the hourly minimum wage to $15 by 2017, with a sliding time frame depending on the size of the business. Proponents of the measure, dubbed the Minimum Wage Act of 2014, are just beginning to collect the necessary 9,702 signatures to qualify for the November ballot, and a recent poll found that 59 percent of likely voters supported the increase, while only 36 percent were opposed.

Business groups are usually the first ones to object to higher wages, but the San Francisco Chamber of Commerce and other small business-leaders are working with Mayor Ed Lee to craft their own, albeit more watered-down, ballot measure to increase pay. Despite their efforts, the $15/hour initiative took them by surprise and they are "outraged," according to a statement released by the Chamber.

"This initiative is nothing more than a thinly veiled attempt to influence the outcome of the consensus-building process that will begin this week under the leadership of Mayor Ed Lee," Chamber President Bob Linscheid said in the statement.

But many small businesses actually want to see the minimum wage increased, said John Eller of Alliance of Californians for Community Empowerment, one of the labor groups sponsoring the $15/hour initiative.

"What we heard when we talked to small businesses was that big money is coming in to buy up properties, that prices are getting jacked up, and that they are getting displaced, just like the residents of San Francisco," Eller said. "But genuine interest in San Francisco, supporting young people, getting people out of poverty, and dealing with displacement were the themes that kept coming up."

The business community wants to see the higher minimum wage phased in over a longer period of time and supports a more "moderate" wage, although an exact rate has not been decided, according to an email sent by Henry Karnilowicz, president of the San Francisco Council of District Merchants Associations. Other concessions that business leaders ask for include a separate, lower minimum wage for tipped servers and new hires in-training.

Comments

Labor rates are regulated. Cost-of-living is not and therefore, subject to market caprice. Analagously, if labor rates and markets were in a relay race, then markets have about a 326-lap advantage in San Francisco.

If one's annual gross income is $31,000 ($15/hourly) and one's annual gross rent is $42,000 ($3,500/monthly), then one's household economy is in disequilibrium or, supply does not equal demand.

Posted by Awayneramsey on May. 14, 2014 @ 12:50 pm

Problem solved.

Wages are driven by added value, not by what the worker thinks he wants or needs

Posted by Guest on May. 14, 2014 @ 1:17 pm

or managing a business of any notable size...most policy makers in SF are either academics or bureaucrats - Mark Farrell is an exception, as is David Chiu- saying that, we get these schemes to help low wage workers that do the exact opposite. I am thinking of the line cooks and dishwashers, janitors and security workers whose wages are held down because the highly compensated 'front of the house' get raises even though they earn well over 25 an hour and up when tips are considered.

Posted by Guest on May. 14, 2014 @ 3:51 pm

small business owner, I always vote for them.

If it is an "activist", a "public interest lawyer", a public sector worker" or any kind of professional politician, then I never vote for them.

Real-world experience of how wealth is generated is crucial.

Posted by Guest on May. 14, 2014 @ 4:05 pm

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