Emeryville Releases New Minimum Wage Study

Most Businesses Have Accepted the Minimum Wage Ordinance

Restaurant Sector is Still Angry 

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Wages Up Regionally as Neighboring 

Cities Follow Emeryville's Lead

The City of Emeryville this week released a revised and recommissioned academic study for its minimum wage ordinance, the results showing a business community that has largely come to terms with the 2105 ordinance, excepting a defiant restaurant cohort who’s animosity towards the ordinance has grown since the release of the first business study in 2016.  The current data rich study, called the City of Emeryville Business Conditions Report and commissioned by the City, is comprised of a comprehensive city-wide business survey with an analytical academic investigation.  It was conducted by the Lorry Lokey School of Business and Public Policy at Mills College, the authors of the first Minimum Wage Ordinance (MWO) study.  This most recent study was completed last summer.

Unlike the first MWO study with it’s look exclusively into the effects on Emeryville’s businesses, the current iteration is more expansive.  Findings have been based on a survey focused on “…how City of Emeryville Labor Ordinances (i.e., Minimum Wage, Paid Sick Leave, and Fair Workweek) have impacted revenues, prices, and employment patterns among local businesses” according to the study’s executive summary.

The survey part of the Business Conditions Report included only Emeryville business owners or managers, workers were not surveyed. The survey, sent out to 319 private Emeryville businesses across the spectrum of business types netted 101 respondents.

All Business Owners' Sentiments About the MWO
as a Percentage
More are neutral and positive about it than against it
but more are against it than in 2016.

Most business owners in all cohorts responded that ‘business is worse’ at a rate of 33% over those who found business to be better (14%) since the MWO was enacted.  However most also found that their productivity had increased 22% versus 19% stating a decline.  Morale has been found to have improved dramatically because of the MWO at Emeryville’s businesses with 33% reporting an increase over 18% stating a decline.  Another factor that has improved for businesses the survey reports, is the number of job applicants for business owners to select from; a 27% increase.  This improvement comes against a generally improving employment rate in the Bay Area that is credited with driving down the number of job applicants in the aggregate at businesses outside Emeryville.
Emeryville businesses have been shown to have increased their prices in response to the challenges brought by the MWO’s implementation by wide margins, especially in the food service sector.

Emeryville's Retail Business Likes The MWO
The green pie slices represent those businesses that
like the MWO.  The red and yellow are those who don't. 

Business owners’ reaction to the ordinance is evenly split the study found, independent of their bottom lines.  After the Minimum Wage Ordinance wage increases hit $15 per hour for small businesses in 2018 ($15.69 for large businesses), business owners collectively responded favorably, seeing it as good or fair at a rate of 21% for those businesses affected by it with an additional 7% expressing favorability for those businesses not affected by the MWO. These numbers were offset by a rate of negativity about the MWO at 24% with an additional 4% of business owners responding negatively whom are not affected by the wage increase.

Food Service Sector Unhappy
Those most unhappy with the MWO, by far, have been shown to be restaurant owners/managers.  An entire section of the study is devoted to them.  Their overwhelmingly negative responses dragged down the overall rate of satisfaction for all business types citywide.  When viewed separately, restaurant owners were found to be dissatisfied with the MWO’s latest wage hike in 2018 at a rate of 67%, owners stating the wage increase negatively impacts their businesses. The category of taxes and regulation, which includes the MWO, are very unpopular with restaurant owners; 41% responding that is their biggest problem in Emeryville, closely following parking availability, 42% of whom found that to be their biggest problem running a business here.

For businesses not in food service, the study shows business owners as mostly favorable to Emeryville’s MWO.  The retail sector generally showed an acceptance of or even support of the MWO.  Overall, about 22% of the retail managers have negative feelings about the Minimum Wage Ordinance, while 47% report support for the ordinance.

Neighbor Cities Raise Theirs
The passage of Emeryville’s landmark Minimum Wage Ordinance caught many municipal neighbors by surprise and many have rushed in to effectively meet Emeryville’s challenge.  Beginning in 2019, the cities of Berkeley and El Cerrito have matched Emeryville’s small business $15 per hour rate while other neighbors have also raised their minimum wages in response to Emeryville’s lead.  This reaction, predicted by the Tattler in 2015, represents a new effective progressive regional minimum wage reflecting the shared values in the Bay Area and serves as a moral counter to previous calls for a ‘regional minimum wage’  at a much lower rate en masse by the business community.
Emeryville's minimum wage, formerly the highest in the nation, has recently been eclipsed by SeaTac Washington.  However, Emeryville's rate increase scheduled for July 1st could put it back on top by a few cents.

Emeryville's Minimum Wage Ordinance Elevates the Regional Wage
A 'regional minimum wage' can be poverty rates region-wide if no city
makes a move to raise theirs
or
region-wide livable rates if one city moves to raise theirs.

The City of Emeryville Business Conditions Report can be seen HERE.
The first MWO Business Study from 2016 may be seen HERE.

Actual Response From a Restaurant Owner to a Survey Question
The redaction provided by the City of Emeryville
...but you get the picture.