FOR IMMEDIATE RELEASE, May 26, 2004

Mandatory Increase Harms Consumers and Employees

(Sacramento, CA) – In a move that angered many small business owners that were present for “Small Business Appreciation” day, the California State Assembly today passed legislation that would increase the minimum wage from the current $6.75 per hour to $7.75 per hour

While proponents of the legislation – AB 2832 by Assemblywoman Sally Lieber (D-Santa Clara) – cited examples of past minimum wage increases not having adverse impacts on the economy, data available suggests otherwise. According to the United States Congress’ House Education & the Workforce Committee, “an increase in the minimum wage leads to overall job loss for affected employees, particularly the least skilled.”

Commenting on the legislation’s potential impact on the small business community, Consumer Alliance for a Strong Economy Executive Director Christopher Wysocki said, “Increasing the minimum wage while the state is struggling to emerge from recession is irresponsible, and it is incredible that policy-makers fail to see the fact that this measure will cost jobs and raise prices for consumers.”

The measure was the subject of intense debate, and passed on a largely party-line vote. “Small businesses and consumers should take a very close look at how their legislator voted on this misguided policy. When teenagers are not able to get summer jobs or new citizens seeking to gain valuable work experience can’t find their first job, they should look to this bill as the root cause of high unemployment,” said Wysocki.

The Consumer Alliance for a Strong Economy will continue to urge its more than 9,000 members across California to communicate strong opposition to this measure as it comes up for a vote in the State Senate. If it should get to the desk of Governor Schwarzenegger, CASE members will urge him to veto this bill as a way to keep California competitive.

The Consumer Alliance for a Strong Economy is a non-profit 501 (c4) corporation dedicated to promoting the interests of consumers and small businesses in California and around the nation. For more information, please call Chris Wysocki at (916) 444-1502 or visit the C.A.S.E. website at www.ConsumerAlliance.org.