San Diego City Council Committee Advances $25/Hour Minimum Wage Tourism Worker

The San Diego City Council Cost of Living Committee voted unanimously to advance a proposal that would raise the minimum wage for tourism industry workers from $17.25 an hour to $25 an hour.

According to the ordinance proposal, minimum wage would be raised by 45% for all hotel, event center and janitorial service workers in the tourism sector. Should it be passed, the ordinance would go into effect on January 1, 2026.

The proposal was authored by Councilman Sean Elo-Rivera, who brought forth the proposal because of San Diego’s high cost of living and how workers are struggling. He specifically cited MIT’s living wage calculator which states that a single-person household in San Diego County needs just over $30 an hour to meet basic needs.

“While out-of-town corporations rake in record-breaking profits, the people who are the backbone of the tourism industry are struggling to pay rent, put food on the table, and keep up with San Diego’s skyrocketing cost of living,” said Elo-Rivera on Thursday. “They’re already struggling to pay their bills. They’re struggling not to be able to have rates that are affordable to individual family travelers. And it would just make that even worse. It will be well targeted to make sure that it doesn’t have negative consequences that we don’t want it to have, but also rewards the workers who are the heartbeat of this economy.”

Before the Committee vote, those opposing and supporting the ordinance proposal spoke. Hotel and even center owners and groups came out strongly against the ordinance, saying that prices would rise as a result, with the ordinance leading to layoffs and reduced taxes for the city as tourists would look elsewhere because of the high costs. The San Diego Regional Chamber of Commerce, the San Diego Regional Economic Development Corporation, the San Diego Padres, the San Diego County Lodging Association and numerous other hotel, restaurant and other tourism industry groups all opposed the ordinance on Thursday.

“The wage increase would lead to layoffs of hotel workers and reduced tax revenues for the city,” said Robert Gleason, board chairman of the San Diego County Lodging Association. “Hotel occupancy is still below the pre-pandemic level from 2019, and occupancy is what drives employment. San Diego is already having a hard time competing for price-sensitive conventions like Comic-Con that’s only committed for two more years here in San Diego. We don’t believe that the economy in San Diego can really afford the negative impact.”

Gleason also pointed out that a study by Oxford Economics over this ordinance found that the $25 per hour minimum wage would cause regional sales to fall by $333 million, would eliminate 4,398 jobs, and would cause a loss of $57.8 million in tax revenue for not only local authorities, but state and federal too.

“An increase in the minimum wage of this magnitude is reckless,” added San Diego Regional Chamber of Commerce President and CEO Jessica Anderson. “It would be detrimental to San Diego jobs, the economy, and businesses, putting our city at a competitive and economic disadvantage as compared to nearby cities. We strongly urge the council to reject this ordinance.”

A $25 an hour tourism worker minimum wage proposal

In favor of the proposal were labor unions and workers in the tourism industry. They claimed that hotels can easily afford the higher wages, and that they risk workers being priced out of the area if wages aren’t moved up drastically soon.

“We have one of the most vibrant tourism markets in the country,” explained Brigette Browning, president of the hotel workers union UNITE HERE and the San Diego and Imperial Counties Labor Council. “This idea that this very rich industry — which, by the way, gets $50 million of tax subsidies every year for their marketing campaign — cannot afford a livable wage is ludicrous.

“The tourism industry is creating two different tiers — of rich people who profit off our beautiful coastline, and very poor people who cannot afford to live here — and I am asking you to stand for the poor people.”

In their vote, the Council wound up voting unanimously for the ordinance, with Elo-Rivera’s staff now being tasked to write the official ordinance in time for the next Committee meeting in June. A vote in the City Council over the ordinance would likely then follow sometime during the summer. Only a small concession was made to the tourism industry, with Councilwoman Marni Von Wilpert managing to have the ordinance include options to phase in the increase instead of it moving all at once to $25 on January 1st, 2026.

“I do think that absorbing a $25 minimum wage overnight would be very hard on a lot of these businesses, who we care a lot about,” said Von Wilpert. “So I want to think about could there be a phased in approach? I think the business owners need to be at the table.”

Nonetheless, Elo-Rivera said that he remained unconvinced by tourism industry leaders saying that layoffs would happen if the ordinance was passed.

“Just to be totally blunt, it’s the same argument every time,” added Elo-Rivera. “It doesn’t matter what decade we’re having the argument. Every time we talk about increasing wages for workers, making things fair for workers, they tell us the economy will break.”

However, hotel and other industry leaders remain very concerned with the ordinance, with several City Council members not on the committee saying that they were concerned with the ordinance as well. They all cited the statewide AB 1228 law which raised fast food workers wages to $20 an hour. As it was such a drastic increase, it caused many stores to close, higher prices, and  job losses. Since September 2023, over 10,000 jobs have been lost as a result of the bill, with even the SEIU union now admitting that those job loss numbers were indeed real. It has been such a disaster it helped influence voters to reject Prop 32 in November, which would have raised the state minimum wage to $18 an hour.

“This is a terrifying potential ordinance,” said Michael Sawyer, a restaurant co-owner in the city, to the Globe on Friday. “Look what happened with the fast food raise. You do that here, we won’t have as many tourists coming in. You know, convention goers, people heading down to TJ [Tijuana]. All that. Just because you think the hotels can afford it doesn’t mean that they aren’t the only ones affected. This is going to help some little guys at the expense of other little guys. What a boneheaded idea.”