City Officials Outline Benefits of 'Living Wage' Law
City News Service - June 3, 2005
By Erin Park

City officials highlighted a study today showing that the "living wage" law adopted in 1997 raised pay for almost 10,000 workers without creating the job losses that critics of the ordinance had anticipated. "This study offers compelling evidence that living wage laws can improve the quality of life for low-income workers," said co-author David Fairris, an economics professor at UC Riverside. But the study also found that many workers are still struggling to get by, and that the law has failed to prompt employers to set up health insurance plans for their workers, as backers of the ordinance had hoped. The policy requires city contractors to pay workers $10.03 an hour, or $8.78 plus a $1.25 contribution to health benefits. Workers are also given 12 paid and 10 unpaid days off a year. The law was designed to eliminate the incentive for government to contract out jobs to low-wage employers. Co-authored by researchers with the Los Angeles Alliance for a New Economy, a group that pushed for implementation of the law, the study is the first to examine how the ordinance has impacted workers and employers. The majority of pay increases were at jobs at Los Angeles and Ontario international airports, where the average mandatory pay jumped by $1.50 an hour, or $2,600 a year, the study found. Thirty-one percent of affected workers lack health benefits, and 44 percent rely on at least one government assistance program, the study found. Still, researchers noted that 70 percent of workers affected by the law are low-income. More than 125 cities and counties nationwide have enacted "living wage" policies over the past 11 years. "Workers are certainly enjoying better pay and better benefits, and employers ... are enjoying and benefiting from a reduced turnover and absenteeism by their employees," City Council President Alex Padilla said.

 

 

LosAngelesLivingWageStudy.org