Minimum Wage Lessons for San Diego Are All Over the Map

This post has been updated.

Some San Diego business owners are wary a minimum wage hike could paralyze their companies — and they’re especially afraid of two provisions in the proposal on the table: the wage itself (as much as 15 percent higher than the state-mandated minimum wage) and subsequent hikes that are tied to inflation.

But several other cities have tried both approaches in City Council President Todd Gloria’s proposal to increase the minimum wage to $11.50 over three years.

The wage increase itself — and the inflationary increases planned after those three years are up — aren’t radical. In fact, they’re pretty common in the roughly half-dozen other minimum-wage ordinances that voters and local governments have approved in other cities or municipalities over the last 10 years. San Diego’s measure mirrors many others in its explanations of who the ordinance will cover and how the wage increases will be phased in.

Gloria and other backers of San Diego’s proposed measure  have said they looked to other cities as guides.

Here’s how the San Diego proposal compares in a few key areas.

How Wages Spike in the Future

Gloria’s measure kicks off with three years of specific minimum wage increases – $9.75 in 2015, $10.50 in 2016 and $11.50 in 2017.

But what comes in 2019 is actually more contentious these days.

Some business leaders have criticized a portion of the measure that calls for the city to begin adjusting the minimum wage annually based on Consumer Price Index changes starting in 2019. One said the move would be “disastrous” for the city.

It isn’t a radical proposal, though. The same component is in the majority of minimum-wage measures already approved elsewhere.

All but one of those nine cities rely on the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W. This measure, which the Social Security Administration uses to determine cost-of-living adjustments, is tied to prices of goods and services that urban workers might encounter. The CPI-W is what Gloria proposes using in San Diego to determine future minimum wage increases.

Most of the cities with their own minimum wage increases rely on data from cities in their region or across the U.S. to come up with cost-of-living numbers that help determine the minimum wage.

Washington D.C., the outlier here, relies on the Consumer Price Index for All Urban Consumers in its metropolitan area. That metric focuses on the buying habits of an urban population, and the percentage increases associated with it tend to be a bit lower than the CPI-W.

How Much Others Hiked Wages

San Diego’s proposed minimum-wage hike would initially increase the mandated hourly pay to more than 8 percent above the state’s $9 an hour requirement.

And come 2015, San Diego companies would be required to pay about 15 percent more than the state’s $10 an hour.

This is a fairly paltry increase compared with ambitious measures that have passed elsewhere.

SeaTac voters narrowly approved a $15 an hour minimum wage in November that’s 16 percent over Washington’s state minimum wage.

And minimum-wage workers in the Santa Fe metro area receive hourly wages about 40 percent more than many of their counterparts elsewhere in New Mexico.

But those two are outliers.

On average, employers in cities and counties that approved wage hikes are paying about 22 percent more per hour than their states mandate.

Gloria’s original proposal – $13.09 by 2017 – would’ve exceeded that average. If it had passed, San Diego’s minimum wage could have been about 31 percent more than the $10 an hour wage the state is set to reach in 2016.

But even with that more ambitious proposal, the first-year increase to $11.09 would’ve been just 23 percent above the state’s current $9  minimum wage, about in line with what other cities have done.

Who Gets to Decide

It’s not yet clear whether San Diegans will get to vote on whether there should be a minimum-wage increase.

Gloria and other City Council Democrats are still debating the best approach.

Gloria’s interested in a November ballot measure and is moving forward but others, particularly City Councilman David Alvarez, have suggested a City Council vote might be a better bet.

Indeed, most municipalities that pushed through higher minimum wages have done so with a city council or county commission vote.

Albuquerque and San Jose approved minimum-wage hikes in November 2012 while voters backed San Francisco’s in 2003. Ten years later, SeaTac voters approved their minimum wage hike.

Several cities across the nation are now weighing similar approaches.

But most local ordinances have been approved by government leaders for one major reason: Letting voters weigh in is a big risk.

San Diego leaders are certainly familiar with such conundrums.

Former Mayor Jerry Sanders once threatened dramatic service cuts, including to police and fire, if a half-cent sales tax didn’t pass in 2010 only to see it fail.

And voters overwhelmingly overturned Barrio Logan’s community plan this June following years of work with residents and business leaders there.

So while Democratic voters, often considered more likely to favor minimum-wage hikes, have a 13-point registration advantage over Republicans and there’s growing national drumbeat surrounding the need for such increases, voter approval is far from a sure thing.