Published July 15, 2022;
The Living Wage Act was supported by a campaign to raise the state minimum wage. Although the proposition to increase California’s minimum wage to $18 an hour by 2025 was unsuccessful on the November 2024 ballot, it aimed to build on existing minimum wage policies and would have raised pay for approximately five million California workers, according to companion reports from the UC Berkeley Labor Center and the Center on Wage and Employment Dynamics (CWE).

In the Labor Center report, 5.1 million workers, or 26 percent of the California workforce, would have received wage increases under the Living Wage Act proposal by 2026. This report examines which workers stand to
benefit from the proposed increase.

Key findings include:

• On average, each affected worker will see an annual earnings increase of $1,349.
• Nearly all (96 percent) affected workers are adults and more than 70 percent work full time; 38 percent have children.
• Latinx workers constitute about 40 percent of all workers, but they represent more than half of all affected workers.
• One-third of impacted workers are in the retail or restaurant industry.

“The increase in the minimum wage will help millions of low-wage California workers deal with the rising cost of living,” said Enrique Lopezlira, director of the UC Berkeley Labor Center’s Low-Wage Work Program.

A complementary CWED policy brief estimates that an $18 minimum wage would increase pay for 4.8 million working Californians by 2025 and restore the loss in purchasing power caused by high inflation in 2022—with little to no impact on the state’s job numbers or on inflation itself.

Key findings include:
• Existing local and state minimum wage laws will provide inflation-adjusted pay increases to four million workers in 2025. The ballot initiative will increase pay over and above the inflation adjustments for those four million workers, and raise pay for an additional 800,000 workers.
• The ballot initiative would lift over 3.5 million Californians above the federal poverty threshold.
• Taking into account inflation adjustments in existing state and local minimum wage laws, $18 by 2025 would effectively increase minimum wages by another 6.1 percent, or two percent per year over three years.
• Prices would increase by just .042 percent over three years, or .014 percent per year.

“The best evidence suggests that an $18 minimum wage would effectively eliminate poverty among California’s working families without reducing job numbers or  exacerbating inflation,” said Michael Reich, chair of UC Berkeley’s
Center on Wage and Employment Dynamics (CWED).

Read the full CWED and Labor Center reports.