Los Angeles Wage Increase Will Affect Workers and Small Businesses

Raising to $ 12 an hour the minimum wage in the city and county of Los Angeles this July first can cause a reduction in the hours of work of the employees, according to warn experts and small businessmen.

The concern is due to the increase, $ 1.50, the highest jump that has come along the way to reach the goal of fifteen dollars, and that for small businesses can make a significant impact.

By 2015, Los Angeles City Councilors agreed that hourly wages will increase gradually with a first increase to $ 10.50 an hour from July 1, 2016 and the second increase to $ 12 per hour from 1 Of July of this year.

Gary Toebben, president of the Los Angeles Chamber of Commerce, told Efe that this second increase represents 14% of the hourly rate, a difficult burden for some entrepreneurs.

“All employers with minimum wage employees will have to make adjustments by raising prices, reducing the number of employees or hours of work,” he predicted.

In that line, economist and financial consultant Ivan Gonzalez said that “when wages are increased they think about big companies, but nobody thinks about small and medium entrepreneurs.”

A study by the University of Washington released this week found a sharp reduction in jobs and incomes for Seattle workers benefiting from a $ 13 an hour wage increase since January 2016.

According to the study, at least 10.7 percent of jobs paying less than $ 19 have disappeared, a finding that would seem to confirm gloomy omens about the future of workers earning the minimum wage in Los Angeles.

But for workers and immigrants like Irma Cervantes, who has two jobs in the fast food sector, the implementation of the measure this Saturday will allow him to increase his monthly income.

“I work to pay the rent, everything is in the clouds, sometimes not enough to eat well,” says Cervantes, who has a working day of 60 hours a week.

The Los Angeles salary increase will apply for companies that have more than 25 employees, but employers such as Jose Hernandez, owner of two restaurants and a small supermarket, who may still be waiting to comply, are worried .

“I try to pay a dollar more than the minimum so that my employees feel happy, but now it turns out that not even the minimum arrived and the economy has not yet recovered, it’s a truth no one wants to see,” he said.

The warnings are shared by business guilds in other major cities such as New York, where Christopher Kelder, a member of the New York Farm Bureau, says high increases will prevent investment, expansion and creation of new businesses, as well as affect To small farmers.

The State of New York has in fact devised a security plan that could suspend the increases temporarily if the economy of the region is affected, following the corresponding analysis that would be in charge of the Budget Division.

While it will take some time to assess the impact of the measure in Los Angeles, Toebben warns that the increase will “catch the attention of all sectors” and motivate employers to develop their own plan.

“The minimum wage increases in the past have been lower and the negative impacts were not obvious,” he said.

On the other hand, city councilors like Jose Huizar say that a better minimum wage will help the working class.

This assertion finds support in a study of the University of Berkeley, spread almost at the same time as Washington, and asserts that “negative” is the “negative impact” generated by the increase in wages in Seattle, Washington .

Aside from discussions, the Los Angeles County Department of Consumer Affairs has already prepared to monitor employers’ compliance with the increase required by law, given that in the previous increase the authorities received complaints from some workers.

This week, Los Angeles prosecutor Mike Feuer has filed lawsuits against fast food chain Carl’s Jr. for allegedly failing to pay dozens of its workers a minimum wage of $ 10.50 an hour.

“I hope they do not cut me hours and let me enjoy these 90 dollars that I will earn from others, that serves me to try to save or put the internet so that my children study,” Cervantes said.

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