UCSC economics chair testifies on bill to raise California's minimum wage

Rob Fairlie
Professor and chair of economics Rob Fairlie

UC Santa Cruz professor and chair of economics Rob Fairlie told state lawmakers that California's minimum wage should be raised so its purchasing power doesn’t continue to erode with inflation.
"The economic security of our low-wage workers in California is just too important to allow that to happen," Fairlie told members of the state Senate Appropriations Committee during hearings on AB10 that would raise the minimum wage over the next few years.  

The bill's author, Assemblymember Luis Alejo, D-Watsonville, invited Fairlie to provide expert testimony on the minimum wage, inflation, and the poverty line. Fairlie has conducted research in labor economics for more than 20 years.

Alejo's bill passed the Assembly in May. Last week, the Senate passed the bill with amendments on a vote of 26-11; the Assembly later approved the amended version. Gov. Jerry Brown is expected to sign it.

If the bill becomes law, the current $8-an-hour minimum wage in California will jump to $9 in July 2014 and to $10 in January 2016, the highest in the nation. The federal minimum wage is $7.25.

The increases in the amended bill are greater and come sooner than in Alejo's original bill. The Senate further removed a provision that called for annual adjustments based on inflation after 2017.

In his testimony, Fairlie said a California worker making the current $8 minimum wage would have to work 58 hours per week for an entire year to be at the federal poverty line of $23,283 a year.

Fairlie said 10 states currently index their minimum wage to cost of living
changes. These include Arizona, Colorado, Florida, Missouri, Montana, Ohio, Oregon, Rhode Island, Vermont, and Washington.