The Los Angeles Area Chamber of Commerce has come out against Mayor Eric Garcetti’s plan to raise the minimum wage to $13.25 per hour by 2017, saying it would kill jobs and costs businesses about $10,000 per employee.
The state and city minimum wage is now $9, set to go to $10 in January 2016.
“This stand-alone proposal will reduce, not increase the number of jobs in Los Angeles,” chamber president Gary Toebben said. “Many employers, especially small businesses and nonprofit organizations, will be forced to raise prices, lay off workers, cut hours or move across the street into another city to avoid this cost increase. None of these are good for our economy.”
Toebben said “any discussion of wage increases must be one part of a larger plan with concrete steps to grow our economy, increase private sector jobs and bring new businesses to Los Angeles.”
Once social security, workers compensation and other costs are counted, the cost of the proposed minimum wage hike would be about $10,000 per employee, the chamber said in a release.
The chamber’s opposition comes after the Central City Association, which represents downtown Los Angeles-based businesses, suggested the mayor’s proposed $4.25 increase be spread out over four years—instead of three years—for companies with more than 500 employees.
Smaller companies and nonprofits should be allowed to phase-in the increase over seven years, the group said.
The group also suggested a separate, lower minimum wage for teenage workers, and asked the mayor to abolish the city’s business tax, “without imposing unreasonable additional taxes on businesses.”
The group also called on the City Council to drop a proposal to raise hourly wages for some hotel employees to $15.37.