CA Minimum Wage Increase Could Mean Loss Of 400K Jobs: Study

CALIFORNIA -- California could lose 400,000 jobs if the state continues with its plan to raise the minimum wage to $15 by 2022, according to a study released this month. The study, conducted by nonprofit Employment Policies Institute, claims that the job loss would affect the food service and retail industries the most.

The study, which was conducted by David Macpherson of Trinity University and William Even of Miami University, examined the minimum wage in the Golden State since 1990. The state plans to increase the minimum wage to $11 an hour next year for companies with 26 employees or more, and $10.50 for businesses with 25 employees or less. It will eventually rise to $15 an hourin 2022 for employers with 26 or more employees.

Researchers from the conservative group said "that each 10% increase in the minimum wage has lead to a nearly five-percent reduction in employment in industries with a higher percentage of lower-paid employees. Across all industries, their findings imply that each 10% increase in California’s minimum wage has reduced employment for affected employees by two percent."

Researchers added that "this estimate is conservative, as it measures the impact of California’s state minimum wage but does not covering the impact of local minimum wages."

Supporters of a minimum wage increase maintain that California workers need to earn more to be able to afford to live in the Golden State.

California isn't the only state that plans to increase its minimum wage gradually. The District of Columbia has plans to offer $15 an hour by 2020.

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