Los Angeles mayor proposes minimum wage increase to $13.25

LOS ANGELES - Los Angeles, the second-most populous U.S. city, would boost its minimum wage to $13.25 by 2017, almost twice the current federal minimum, under a proposal by Mayor Eric Garcetti.

Garcetti, a 43-year-old Democrat, will ask the City Council to lift the prevailing $9 minimum to $10.25 next year, then phase-in $1.50 annual raises over the following two years, according to his office.

The mayor's proposal on Monday, timed for the Labor Day holiday, is part of a nationwide push in cities and states to lift wages for low-income earners, after efforts to raise the federal standard of $7.25 an hour stalled in Congress.

The Los Angeles minimum would top out at $13.25 in 2017, when the state wage is to reach $13 under a California law signed by Governor Jerry Brown last year. The city's minimum would also exceed San Diego's, where the City Council overrode a mayoral veto to boost the base rate to $11.50 in three years.

Seattle will raise its minimum to $15, the highest among any large U.S. city, over the next three to seven years, depending on the size of the employer. In San Francisco, voters in November will consider setting a $15 minimum by 2018.

Garcetti's proposed $13.25 rate, which would be followed by annual increases linked to inflation, would cost employers an extra $10,000 per employee per year once benefits are factored in, said Gary Toebben, president of the Los Angeles Area Chamber of Commerce.

"Those employers will have choices to make regarding price increases or cuts in expenditures and many will either reduce the number of employees or reduce the hours that employees are working," Toebben said by email before the announcement. "We are also concerned that in a county with 88 cities, the businesses in Los Angeles will face a competitive disadvantage when it comes to price."

The chamber hasn't taken a formal position on the measure, Toebben said.