San Francisco Deserves a Raise

Cyrus Gill is a junior hospitality management and entrepreneurship and innovation double major.

College students rejoice, San Francisco believes its minimum-wage workers deserve a raise. The San Francisco Board of Supervisors has voted unanimously to increase the city’s minimum wage to $15 an hour by 2018. The measure will appear on the November ballot and aims to boost wages in various stages. The minimum wage would be raised to $12.25 next May and gradually increase to $15 by July 2018. Yet again, San Francisco has become a leader in the fight for income equality. The measure is surely not a scenario in which both business owner and employee can be completely satisfied; however, it seems the social benefits greatly outweigh the potential monetary loss.

raiseShaw San Liu, an organizer for the Coalition for a Fair Economy, voices that more than 100,000 minimum-wage earning San Franciscans would receive an annual increase of $9,000 once wages hit $15 an hour. While I see the increase as an exercise in workers’ rights, others believe the measure may drive more jobs out of San Francisco. According to a report published by the Office of Economic Analysis, by 2009 15,270 jobs may be lost due to the wage increase, roughly translating to a 2% increase in unemployment. I would be concerned if I lived in Detroit, which has a staggering 23% unemployment rate, but this is San Francisco, which has one of the most competitive job markets in America. According the U.S. Bureau of Labor Statistics, San Francisco’s unemployment rate has shrunk to 4.4%, which is considerably lower than the state average of 7.3%. It is apparent to me that minimum-wage earners are being driven out of the city due to the ever-increasing cost of living, and not because San Francisco lacks a demand for labor.

We must also keep in mind the possible business advantages to paying employees a higher wage. In the book, “When Mandates Work: Raising Labor Standards at the Local Level”, just published in January, several UC Berkeley economists explain that increasing wages allowed companies to actually save money due to reduced employee turnover. San Francisco International Airport saw turnover decrease 60% between 2004 and 2011 primarily because they paid their workers a higher minimum wage than the average. If minimum-wage earners can afford to live in San Francisco, they will spend in San Francisco, expand our economy, and create more jobs.

The politicians and lobbyists have the packet and have weighed the options, but I desperately hope that voters are able to remove themselves from the notion that higher pay means higher prices. The San Francisco Center for Economic Development reported that San Francisco captured 40% of all Bay Area venture capital last year. 2013 also welcomed 16.5 million visitors on our city streets. I cannot imagine a pay increase halting the hordes of hungry tourists or crushing the dreams of the next Steve Jobs. Yes, the market is fickle; some employers may stumble. But business is booming and there is no better time to reward those who desperately need a raise. I would much rather live in a city known for its progressive labor practices than its CEOs, tech buses, and growing income disparity. 

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