Minimum wage set to increase

awileman@sierrastar.comJune 17, 2014 

For many Californians working for minimum wage means long hours and little pay. It means working jobs that many people are unwilling to work, in conditions that are unsuitable for a vast number of the population.

For those who experience working a 40+/ hours a week job, grossing a gross total of $15,360 a year, a moderate increase in pay is on the way.

In late September of 2013 California State Legislatures and Governor Jerry Brown approved and signed Assembly Bill 10 which enacted legislation raising the minimum wage for all industries in California.

Authored by Assemblymember Luis Alejo (D-Salinas), AB10 will raise minimum wage to $10/hour by 2016, up from $8, and will take its initial step on July 1, raising from $8 per hour to $9 per hour.

The decision to raise the minimum wage came weeks after legislators argued the potential economic impact of raising the states minimum wage to the highest in the nation — the nation's minimum wage is currently $7.25/hr.

Brown explained in a press conference back in 2013 that the reasoning behind the hike is not only to help those who are below the poverty line but also to stimulate the economy.

Brown reiterated the importance of minimum wage workers who are the backbone of the country and indicated that the minimum wage hike was a reaction to the inflation and the higher prices that can be seen in everyday life.

"The minimum wage has not kept pace with rising costs," Brown said in a statement to reporters. "This legislation is overdue and will help families that are struggling in this harsh economy."

However, bigger pay checks for many brings more extensive bills for others. In the past 17 years, minimum wage has increased nearly 100% percent, from $5/hr back in 1997. This has placed a burden on small business' which, in a small rural community like Oakhurst, are already struggling to survive.

The California Chamber of Commerce, who apposes the wage increase, has called the bill a job killer and placed AB10 on its annual "job killer" list, which includes legislation it most aggressively seeks to defeat.

The increase has many small business wondering if they will be able to keep their doors open and pay their employees. This could also mean less jobs and more demands from employees on their workers.

A few businesses in the Mountain Area, who chose to remain anonymous, fear the impact because they have signed contracts with corporate offices which do not allow a price increase of the products they sell.

The hike in wages also brings with it the dreaded "I" word — Inflation. With the minimum wage increasing so often many citizens and politicians wonder when or if it will ever stop.

Executive Director of the Madera County Economic Development Commission Bobby Kahn said the potential hike puts pressure on businesses in rural areas making it more difficult for them to remain in the green.

"The employees may make a little more, but the businesses try and off set their costs to make up for lost revenue... business cannot operate in the red," Kahn said.

According to research and clear indication on the effects of increased minimum wage, many businesses in the Mountain Area will have to reevaluate their operation costs to see whether or not they will be able to maintain their current income and be able to continue doing business.

As big business in California weighs the pros and cons of doing business in California and the increasing cost of employees, other privately owned business could be on the edge of extinction.

According to the Oakhurst Chamber of Commerce Executive Director Darin Soukup, an increase in minimum wage has a dramatic impact on local business because of the already short supply of income and sales.

"There is no doubt that a significant minimum wage increase would benefit many of our local residents and seasonal employees," Soukup said. "However, there is concern that the immediate impact of significant minimum wage increase implemented by legislation rather than a gradual increase through market forces would put additional strain on many of our local businesses. The chamber would like to see a strong rebound in our economic recovery where our businesses experience both growth and demand for labor and can increase wages accordingly."

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