Living Wage
Living wage ordinances typically set a wage above the federal minimum wage, but they only apply to businesses that service receive state contracts or recieve assisstance from the government. Living wage policies are meant to ensure that workers recieve enough income to secure basic amoynts of food shelter, transport, medical needs and other necessities.
Commentary
Cry Wolf Quotes
…the stated goal behind the living wage movement is poverty reduction, and many of the ordinances mandate a wage that would lift a family of four above the poverty level. However, as with minimum wage increases, economic studies have shown that living wage mandates do more harm than good to those living in poverty through resulting job elimination and shifting entry-level jobs from lower-skilled workers to higher-skilled workers.
Maryland legislators’ good intentions do not change the fact that living wages result in job loss, particularly among the less skilled and less educated.
Nonetheless, if the goal of the Coastal Zone Minimum Wage is to help low-income workers in Santa Monica, the Ordinance is worse than useless. The direct benefits of the Ordinance are more poorly targeted than in any social welfare legislation we have ever studied.
Most troubling, though, is the fact that the least skilled employees are those who are being most hurt by this ordinance. Voters in other areas considering an increase in the minimum wage must consider these unintended consequences that end up hurting those who the law is supposed to help.
Evidence
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The Economic Impact of Local Living Wages
The Economic Policy Institute finds that the costs of living wage ordinances are often overestimated.
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Examining the Evidence: The Impact of the Los Angeles Living Wage Ordinance on Workers and Employers
Los Angeles Alliance for a New Economy: The LA living wage ordinance brought a pay raise to 10,000 workers, most of whom were poor.
Backgrounders & Briefs
Living Wage Policy Brief: Stephanie Luce
Living wage ordinances have helped thousands of workers and tiresome cry wolf claims are wrong.
