Wage Worries

Jesus Lopez of California Rural Legal Assistance says rising costs could stifle minimum-wage gains.

Miguel Puga pushes a shopping cart through the parking lot of Foods Co in Salinas. He knows his earnings will be increasing with a new minimum wage law, but he’s not sure how much of a difference that’ll make for expenses like this grocery run.

“Everything is coming up,” the 65-year-old says, pointing at his milk, juice and beef. “The meat is already a high price.”

In September, Gov. Jerry Brown signed a bill introduced by Assemblyman Luis Alejo, D-Watsonville, that will increase wages for the state’s lowest-paid workers to the highest in the country. California’s minimum wage will go from the current $8 dollars an hour to $9 in July, and to $10 by 2016.

Though the law will boost pay for many in Monterey County, some ag workers and advocates don’t necessarily see the hike as a ticket to the good life.

“Costs are coming up,” says Jesus Lopez, a community worker for California Rural Legal Assistance. “In the end it’s not helping them.”

Puga makes $9 an hour, but he works only half the year as a seasonal employee. He can afford the mortgage payments on his Salinas house, he says, but not health insurance.

According to Philip Martin, a professor at the UC Davis Department of Agriculture and Resource Economics, a seasonal worker in California makes an average of $13,660 a year – above the individual federal poverty line of $11,490. But a new study shows that the state’s poverty level may be much higher than previously indicated.

Stanford’s California Poverty Measure, released in September, finds with considerations like housing, the state’s poverty level is actually 22 percent of the population, rather than the official rate of 16.2 percent in 2011.

Minimum wage can lift people out of poverty, but some say it’s also a burden.

“We pay substantially more to our workers than do companies in other states,” says Jim Bogart, president of the Grower-Shipper Association of Central California. “Going up over and above [current minimum wage] puts growers here at a competitive disadvantage to food and vegetable producers in other states.”

Local growers pay above the minimum wage partly because there’s been a 20 – to 25-percent worker shortage in the past couple of years, Bogart says, maybe because of stricter immigration policies and crackdowns on undocumented workers. Growers are paying more to keep and attract workers.

In 2011, Alejo introduced a failed bill that would have raised the state’s minimum wage to $8.50 an hour in 2012, then automatically indexed a wage hike every year according to inflation. The Grower-Shipper Association opposed that bill, arguing even a 50-cent hike would have huge impacts on small businesses. A farm with 10 employees, for example, would have seen at least a $10,000 payroll spike.

Those arguments still hold true, Bogart says, though the growers didn’t officially oppose this year’s legislation.

But Lopez says even though many seasonal workers are earning more than the minimum wage now, they’re still struggling. “The way they survive is two or three families living together,” he says.  

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