Statement on California’s Minimum Wage AB 10 by Assembly Member Luis A. Alejo

Thank you, Mr. Chair and Members:

The average price for a gallon of gasoline is $4.00 per gallon.  So a farm worker, a WalMart worker, a restaurant worker, a domestic worker – people earning the minimum wage can buy 2 gallons of gasoline for every hour they work.  And after working a full 8-hour day, they can buy a tank of gas… just to get back and forth to work for a week.

It’s projected that gas prices will continue to rise up another 13% this year.  And that’s not the only thing rising.  So is the cost of wheat – up 67% this year.  The price of corn – up 60% this year.

And when grain prices rise, so do the costs of animal who feed on it.

Economists predict a 6% increase in the cost of food this year.  For the average household, that’s about $328 per family more than what they spent last year.  That’s almost two-weeks of take-home pay for a minimum wage workers… just to keep up with the increase.

The price of cotton is also increasing – a projected 150% increase over last year.  Economists predict that will result in a 10% increase in the cost of clothing.  For the average household, that is about $139 more per family than what they spent on clothing last year.

AB 10 is about equity.  It is about ensuring that workers can maintain purchasing power year after year.  For three years, workers have struggled to get by in light of rising prices while their real wages declined 2.9%.

The fact of the matter is that raising the minimum wage will help our economy by generating more consumer spending.  When minimum wage workers have more money to spend, they spend it.  They cannot afford to save it. 

According to a new study co-authored by economic professors at the University of California at Berkeley, the University of Massachusetts, and the University of North Carolina, raising the minimum wage does not eliminate low-paying jobs in either the short- or long-term.

I have here with me today Dr. Sylvia Allegretto, Deputy Chair of the Center on Wage and Employment  Dynamics at the Institute for Research on Labor and Employment at U.C. Berkeley to further speak on that point and to testify in support of raising the minimum wage.

(Dr. Sylvia Allegretto testimony)

I also have here with me today Mr. Marcus Marquez.  A small business owner of a local restaurant.

(Mr. Marcus Marquez testimony)

(Others in support.)

(Opposition testimony.)

CLOSING:

It has been three years since minimum wage workers have been given a raise. 

The purchasing power of minimum wage workers declines on an annual basis while the cost of goods and services increase every year.  

Let’s not forget that the federal minimum wage was first adopted as part of the Fair Labor Standards Act of 1938 during the Great Depression. 

On January 1st, the minimum wage was raised in seven states, but California wasn’t one of them. 

Let’s fix that and give hard-working Californians the raise they deserve.

I respectfully ask for an ‘aye’ vote.