L.A. County's minimum wage hike still not a livable wage, experts say

The minimum wage in Los Angeles County will increase by $0.50 to a new minimum wage rate of $17.28 per hour this summer on July 1.

The announcement was made by the LA Office of Wage Standards and applies to all employees who perform at least two hours of work per week for an employer.  

 Earlier this month, a new law took effect in California that raised the minimum wage for fast food workers to $20 per hour next year, making them the highest minimum wage workers across the United States. The law that made this possible was signed by Governor Gavin Newsom last September, where he also dismissed the belief that fast food jobs are meant for teenagers looking to gain experience in the workforce. 

In LA County, the current minimum wage is $16.90 but experts say this is still not a livable wage, especially in L.A., where the cost of living is more expensive than in other parts of the nation. 

BACKGROUND 

 In 2015, the Los Angeles County’s Board of Supervisors adopted the “Los Angeles County Minimum Wage Ordinance,” which allowed for the gradual increase of the minimum wage in the unincorporated areas of the county each year until it reached $15.00 on July 1, 2020, for large employers and July 1, 2021, for small employers. 

The ordinance also stated that beginning in 2022, the minimum wage would increase in LA County annually based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the Los Angeles metropolitan area (Los Angeles-Riverside-Orange County, CA), which the Bureau of Labor Statistics publishes. 

AFFORDABILITY 

 A study published last month by Smart Asset determined that for a single person to live “comfortably” in LA, they must make $53.26 an hour. According to the study, the annual salary needed to live well in L.A. is $110,781 for one single person and $276,557 for two working adults and two children. 

The classic 30% rule advises an individual to spend 30% of their monthly income on rent at maximum; spending more can put you at a financial disadvantage, yet many Angelenos, especially Latinos, are spending much more on rent. 

The Credit Union of Southern California (CU SoCal) says the rent you pay should be affordable for you. According to CU SoCal, affordable means that an individual can pay their monthly rent, buy groceries and other everyday essentials, pay their monthly loan installments and credit card debt on time and have money left over to put in a savings account.

Last week, Councilmember Hugo Soto-Martinez of District 13 said LA is facing an “unprecedented time” because of the “unprecedented housing crisis” many Angelenos face. He also confirmed that many people living in LA are using more than what is recommended for rent. 

“We know that over 60% of Angelenos are renters, and here in District 13, that is over 80%,” Soto-Martinez said. “We know that three-quarters of the renters of the city are rent-burdened, meaning that they spend more than 30 percent of their income on rent, and for the Latino community, it is over 60 percent.”

As of April 2024, the average rent in LA is $2,094 per month. This is 38% higher than the national average rent price of $1,512/month, according to Apartments.com 

One thing to note is that the wage increase coming this summer does not apply to 88 cities in the county, which are considered incorporated territories and therefore some have their own minimum wage requirements and ordinances. Those incorporated cities that do not have their own minimum wage follow California’s minimum wage, which is $16.00/hour and is considered among the highest in the U.S.

Some of the incorporated cities that will also update their minimum wage on July 1, 2024, are places like Malibu, which will increase the minimum wage to $17.27 and West Hollywood, which will increase the citywide minimum wage for all businesses to $19.61.

To learn more about wage standards, ordinances and workers' rights visit the Office of Wage Standards at: https://wagesla.lacity.org/