The Pros and Cons of L.A.’s Coming Wage Hike

There’s a big argument going on in California regarding the pay offered by small businesses to their employees. Though many small businesses are struggling to pay their employees the $9-per-hour minimum wage (or slightly more,) Los Angeles Mayor Eric Garcetti wants to increase that minimum wage to more than $13 per hour.

The proposed increase has pros and cons. The downsides, to small business owners, are obvious.

One Hollywood business owner, Gaston Letelier stopped collecting his paycheck so that he can pay his employees.

His struggles would only intensify if the minimum wage increased by more than $4. It seems clear that his shop – and many others like it – might have to close, unless major changes were made.

However, there are also some obvious upsides. Other cities have instituted similar minimum wage levels before, and Garcetti explains that the issue is a “moral imperative” so that more people can afford the cost of living in Los Angeles. Additionally, many business owners feel the increased wages will bring with them additional improvements: the costs may be “offset by productivity gains from employee retention and better morale,” among other improvements.

Clearly, increasing minimum wages are something that small business owners are going to have to think about deeply – in Los Angeles, currently, but also across the country.

What are your thoughts about the proposed minimum wage increase? Weigh in below.