An L.A. City Councilmember proposes upping the minimum wage for airport and hotel workers to $25 an hour and raising it each year until it reaches $30 in 2028. Businesses are balking.
Jovan Houston wakes most days at 3:30 a.m. and commutes from her Inglewood apartment to the Los Angeles International Airport, where she directs passengers, ensures they have IDs and passports ready, and alerts security if someone goes through the wrong door.
At the end of each shift she’s exhausted, she said, but not done.
She’s home when her 13-year-old son returns from school, and she makes dinner and gets him started on homework. Then she gets back to work — cutting clients’ hair in her living room.
Her $19.04-an-hour pay doesn’t cover basic expenses, she said, and rent goes up almost every year.
“It’s a struggle,” Houston said. “It takes away time to be with my son. I think one job should be enough.”
Los Angeles leaders say they’re considering workers like Houston, who work in travel and hospitality, in their latest plan to shore up wages before the 2026 World Cup and the 2028 Olympics come to town.
Curren Price, a Los Angeles City Council member, has proposed upping the hourly minimum wage for airport and hotel workers in the city to $25 an hour, then raising it $1 each year until 2028, bringing it to $30 an hour.
He also proposed more affordable options for healthcare coverage.
“I find that unacceptable, (that) anyone who works fulltime in our city could still be finding themselves homeless,” he said in a recent city council economic development committee meeting. “So I think it is time that we consider bringing this wage up from a minimum wage to a living wage, so that our families can not only survive, but thrive.”
If L.A.’s city council passes it, the ordinance would boost pay for more than 36,000 workers to more than 38% higher than the minimum wages in most major California cities. Many cities mandate hourly wages above the statewide $15.50 minimum.
The proposed wage ordinance would replace two existing ordinances that set minimum wages at $18.04 for certain LAX employees and $18.86 for hospitality employees at city hotels with 60 or more rooms.
Supporters of the proposed living wage ordinance argue that hotels and airports have fully recovered from the pandemic’s impact. But their low-wage workers continue struggling with living costs in Los Angeles rising faster than pay.
Some L.A. officials predict the World Cup and the Olympics will bring rare economic opportunities to the nation’s second largest city. But union leaders say they don’t expect low-wage workers to share in the profits — not without a push.
“We’re moving this ordinance well in advance of the Olympics because we want to make sure we have laws in place to make sure the workers who do all the hard work actually get some of the benefits,” said Jane Martin, airports director of the Service Employees International Union – United Service Workers West, which represents Los Angeles airport workers.
The union lobbied for the measure, along with the Los Angeles Alliance for a New Economy and Unite Here Local 11, which represents hospitality workers in Southern California and Arizona.
Representatives for airlines and hotels spoke against the proposed ordinance at the economic development committee meeting. They said the ordinance would force them to raise prices and some small businesses would have to close, making L.A. a less attractive tourist destination.
Wave of wage demands
Pete Hillan, spokesperson for the California Hotel & Lodging Association and the Hotel Association of Los Angeles, contradicted the union statements, saying hotels haven’t fully recovered from the pandemic.
“To go from the current minimum wage to $25, that is a huge increase from a cost standpoint,” Hillan said. “For many of these hotels that are family owned, they can’t absorb that.”
Sean Williams, vice president of state and local government affairs for the Airlines for America trade association, said passenger traffic at L.A.X is at 75% of where it was before the pandemic.
Council members Price, Hugo Soto-Martínez and Traci Park voted to study the economic impact study of the proposed ordinance.
The airport and tourism worker proposal is the latest in a wave of demands for higher pay for low-wage workers, many of whom were frontline workers during the pandemic.
Across the country, municipal governments have set pay ordinances for workers in hotels, food service, domestic work, and healthcare. For instance, Inglewood voters last fall approved raising the minimum wage for healthcare workers to $25 an hour in that city.
Similar local ordinances for healthcare workers were floated in Los Angeles, Downey and Long Beach, but they’re all on hold because hospitals collected enough signatures to trigger referendums on the issues.
Democratic state lawmakers also had proposed a $25 minimum wage for healthcare workers statewide. The bill recently passed out of the Senate Appropriations Committee with a newly revised $21 minimum wage proposal. It will be up for a vote in the Senate; the deadline for approval is Friday.
‘Trying to get what they need’
Los Angeles Democratic Sen. Maria Elena Durazo, a labor leader, said she supports other low wage workers in Los Angeles also getting an income boost because the state’s $15.50 minimum wage is not enough to sustain most families.
If the push for $25 in healthcare spills over to other industries, “God bless them,” Durazo said. “They’re only trying to get what they need for their families.”
She added low-wage healthcare workers are similar to low-wage tourism workers; they’re often from the same communities and worked throughout the pandemic.
“We counted on them and now they’re counting on us,” she said.
The California Chamber of Commerce has called the bill a “job killer,” citing its costs to hospitals and health employers.
David Neumark, a labor economist at UC Irvine, said any minimum wage increase would lead to businesses increasing their prices, usually resulting in some job loss.
Neumark said there’s no logic to proposing wage bumps ahead of the Olympics, because increased demand for labor will likely lead to increased wages anyway. What would be more helpful to low-wage workers is strong labor protections, he said.
When the games end, the higher minimum wage may lead employers to lay off more workers, he said.
Martin, at the SEIU, has a different view.
“We’ve seen, when the Olympics have come to different cities around the globe, it’s always promoted as a huge economic opportunity,” Martin said, “But in fact, for low-income communities it usually has an economic cost. People are displaced; working class neighborhoods are impacted.”
Martin said the union’s members can’t make ends meet, so they take second jobs or move far from the airport to afford rent. Also, she said, employees put their health on the line during the pandemic, but the healthcare coverage requirement in the current ordinance hasn’t kept up with the cost of health insurance in California.
Currently the airport and hotel living wage ordinances allow employers to offer health insurance coverage or pay an hourly credit of $5.77 to workers who opt out of health insurance.
The proposed living wage ordinance seeks an increase to the health care credit to meet the average cost of healthcare coverage. It also proposes minimum benefit requirements for those offering health insurance, including family coverage and greater transparency.
Houston has worked at the airport for six years, including during the pandemic, when the airport operated at reduced capacity because of travel restrictions.
Houston’s work hours shrank to four-hour days, three days a week, slashing her twice-monthly paychecks by more than a half, to $500.
She paid rent and made sure her son was fed, she said. Everything else came second, so some bills went unpaid.
“It was chaotic,” she said. “I remember getting, like, red notices from my light and gas companies. I was losing hundreds of dollars during that time.”
Like other employees, Houston worked despite her fear of getting COVID. Initially her employer didn’t provide protective equipment to workers, Houston said; employees had to scavenge through stores to find effective masks and gloves.
“The airport was a ghost town,” she said. “There was no one coming through. It was really hard. During that time, we still had to operate as normal.”
A ‘living’ wage?
Despite Houston’s best efforts to protect herself from COVID, she was infected with it twice. The first time, she was “deathly sick” in the hospital for two weeks, she said.
As a result of COVID, she was diagnosed with chronic obstructive pulmonary disease, a condition that makes it difficult to breathe and causes chronic coughing. She has frequent medical appointments — with a co-pay for $100 — and several prescriptions.
That’s not counting the medical visits and prescriptions her son may need.
“That’s another dig in my income,” she said. “That’s my life.”
Although a $25 hourly wage would still not constitute a living wage for Houston — a living wage for an adult with one child in Los Angeles is $43.81 an hour, according to the Massachusetts Institute of Technology’s living wage calculator — it would be life changing for her, Houston said.
She said it would allow her to finally quit cutting hair, so she could spend more time with her son. Also maybe she could finally buy him the sneakers he’s always wanted.
“He’s a young kid,” she said. “He’s outgoing and he wants to be like the other kids. It’s hard to tell him, ‘No, you can’t have those new Jordans’ or ‘No, you can’t have an iPhone like the other kids.’”
For Houston, higher pay and more affordable healthcare could bolster her dreams about moving to a bigger space with her family.
“I’m 40 years old and I’ve never owned a home,” she said. “I love my family, and I love us all together. I would want all of them to join me and get a big house and we could all live together — but I’m making $19.04.”
The ‘multiplier effect’
Pay ordinances became popular because airlines — which 30 years ago hired workers directly in union jobs offering decent pay and benefits — switched to outsourcing the jobs to companies that pay less and offer lower benefits, said Ken Jacobs, chair of UC Berkeley’s Center for Labor Research and Education.
In California 22 airports have living wage policies, including those in San Jose, Oakland and San Francisco. Some cities, including Anaheim, Long Beach and Oakland, have living wage ordinances for hotel workers.
Los Angeles passed the first minimum wage ordinance for airport workers in the country in 1997, followed a few years later by San Francisco.
Researchers studied the impact of San Francisco’s ordinance and found airport worker turnover decreased dramatically, along with absenteeism, employee grievances and equipment damage during the first few years of the ordinance. Meanwhile productivity increased, said Jacobs, coauthor of the study.
The wage increase in San Francisco didn’t significantly affect the number of jobs or consumers’ travel costs, Jacobs said.
“You’re looking at a relatively small increase in overall price, which is not likely to have a noticeable impact on demand while having a really huge impact on workers’ livelihoods,” he said.
The higher minimum wage could create a “multiplier effect” when workers spend their additional income in the local economy, said Thomas Lester, professor of urban and regional planning at San Jose State University.
The spending stimulated by the $25 wage could spur an estimated $288 million in sales, which would support more than 1,400 additional jobs throughout Los Angeles County, Lester said.
A judge rules that a proposition to raise the California minimum wage to $18 an hour can’t go before voters until 2024. The same judge gave backers of recalling Gov. Gavin Newsom more time to qualify, but in this case he backed the Secretary of State, who said proponents missed a key deadline to qualify…
Had the California Living Wage Act proposal succeeded, it would have increased base wages to $16 an hour next January and $18 by 2025.