Minimum Wage -- Unions Flex Muscle; Governor Changes Stance

Tuesday, March 29, 2016
Union Influence Update

January vs. Yesterday

Here’s what the Governor wrote in his budget proposal from January:

…higher minimum wage laws are not free. They raise the operating costs of many businesses, and the state must shoulder higher wages in its programs…
At $15 an hour… the General Fund would face major increased costs, estimated at more than $4 billion annually by 2021.” Gov’s 2016/2017 Budget Summary, page 11

But, After labor unions worked him over, here’s what the Governor said yesterday:

“It's a matter of economic justice…Remember, you've got to listen to the workers. It is quite incredible that there is so much power, so much wealth, yet so many people are struggling on $10 an hour."  Gov's news conference, 3-28-16

What Changed?

  • It was reported that the Governor was “flanked by labor leaders;” or more likely held hostage. Labor threatened an expensive November ballot measure making California’s minimum wage the nation's highest.  Instead, they’ll push that proposal through the legislature.

  • California has been ranked the worst state to do business, 11 years in a row. California also has some of the nation's highest taxes and regulatory costs. The Governor says the minimum wage will "raise the operating costs of many businesses."

  • Don’t expect excitement among job-creators to locate or expand here in California anytime soon.

Labor unions win. Workers and families lose.