(September 23, 2005) The California Chamber of Commerce is urging Governor Schwarzenegger to veto Assembly Bill 48 (Lieber; D-Mountain View), “job killer” legislation that gives California the highest minimum wage in the country, before the October 9 deadline.

“California currently has the nation's highest energy costs and unemployment insurance tax rates for businesses,” said Julianne Broyles, Chamber director of employee relations and small business. “An increase to the minimum wage would be another cost driver hurting California’s economy just as we are on the road to recovery. Further, giving California the highest minimum wage in the nation will provide a disincentive for employers to locate or expand here.”

Write the Governor using our easy-to-edit position letter.

AB 48 provides a significant disincentive for employers to create jobs by increasing the cost of doing business by at least $2.08 billion annually by raising the state minimum wage to $7.25 in 2006 and $7.75 in 2007, and indexing increases every year after for inflation.

By tying minimum wage increases to inflation and ignoring other factors such as strength of the job market, AB 48 will result in increases in the minimum wage at times when California’s economy is poorly suited to absorb higher employer costs.

California’s current minimum wage is among the highest in the nation, and far exceeds the federal minimum wage of $5.15 per hour.  Currently California has the sixth highest minimum wage, 31 percent higher than the current federal minimum wage, according to federal Department of Labor statistics.

An increase in the minimum wage places another cost on California businesses of all sizes when they are still recovering from other burdensome laws and regulations that have made it difficult for them to survive. Such an increase would send conflicting messages to California businesses that are relying on state leaders to find realistic solutions to high-energy costs, health care costs, the nation’s highest unemployment insurance tax rates and still-high workers compensation rates.

For more information on AB 48 or other “job killer” bills, please visit the Chamber’s website at www.calchamber.com.

Write the Governor using our easy-to-edit position letter.