Governor’s Decision on Minimum Wage Another Blow to Small Business

Rob Lapsley
President, California Business Roundtable

The California Business Roundtable supported increased funding for the CalEITC funding last year and our research on upward economic mobility shows it is a critical anti-poverty tool. But programs like the EITC are only effective when people are at work. Due to the governor’s decision to allow for the minimum wage increase, despite the state having met the economic conditions that would allow it to be temporarily suspended, fewer Californians will come back to work when businesses are allowed to re-open. 

Offramps to suspend increases in the minimum wage were put in place specifically for economic crises like the one we’re in today.

This decision was made assuming businesses, especially restaurants and retailers, will be open in January. The governor’s announcement, however, will only put more pressure on small businesses as they face unprecedented uncertainty. 

Not only do most not know if or when they will be able to re-open, but they are also facing the potential of the largest property tax increase in state history, should Proposition 15 pass in November. These pressures, combined with the minus wage announcement, will only drive more businesses to close their doors for good and put even more residents out of work permanently.

 

 

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