Prop. 32 Fails As Voters Reject Statewide Minimum Wage Going Up To $18 An Hour

Proposition 32, which would have increased the state minimum wage to $18 per hour beginning on January 1, 2025, officially failed on Tuesday, with opponents declaring victory as No votes on the issue managed to reach a majority threshold.

The California state minimum wage has been steadily rising since 2016, when then-Governor Jerry Brown signed SB 3 into law. There a “phase in” tiered set up was installed, raising the minimum wage steadily from $10.50 an hour for larger employers in 2016 to $15 in 2022. After that was reached, annual raises based on the consumer price index kicked it across both smaller and larger employers, with the statewide minimum wage going up to $15.50 an hour in 2023 and $16 at the beginning of this year.

However, the minimum wage in many places and industries is also higher than that. Currently, the minimum wage in San Francisco is $18.67 an hour, while West Hollywood has a $19.65 minimum wage. For fast food employees statewide, the minimum wage was raised to $20 an hour since April, although that endeavor has proved disastrous with over 5,400 jobs being lost so far as a result.

With inflation and the cost of living continuing to rise, Prop 32 was created to quicken the rise of the state minimum wage even more. According to the Proposition, “The ballot initiative would increase the state minimum wage to $18 an hour over several years. Like SB 3, the ballot initiative would increase the minimum wage at different speeds depending on whether an employer has 26 or more workers or 25 or less workers. For employers with 26 or more workers, the minimum wage would reach $18 on January 1, 2025. For employers with 25 or less workers, the minimum wage would reach $18 on January 1, 2026. Also like SB 3, the minimum wage would be tied to the CPI-W after reaching $18.”

If it had passed, the state minimum wage would have briefly gone up to $17 an hour from November to the end of December, when the $18 an hour tier would have kicked in on January 1st.

Early on, support for Prop 32 was high, thanks to California’s high cost of living and high inflation being hot button issues. A USC/CSU Long Beach Poll in January found that the proposition was at 59% approval, with only 34% opposing. By early August, it was still on track to pass, with 52% of voters approving it and only 34% opposing it. But warning signs were evident, with a growing number of undecided voters and the rising number of job losses tied to the fast food minimum wage hike worrying many that a statewide raise could lead to even more losses.

By early September, a PPIC poll, with no undecided option, found that Prop 32 passing was no longer a sure thing, and was now, in fact, very much in danger of being defeated. The poll found that it was a tight 50% to 49% total. This led to an October poll finding that support has slipped even more. According to the poll, only 46% of California voters supported the proposition, with 36% against and 18% undecided.

Following election day, once again, it was looking like Prop 32 might pass. But as votes were tallied in the coming days, No votes began to break away. This led to Tuesday where the latest tally by the state showed that 7,392,422 had voted against it and 7,147,047 had voted yes on it, with 94% of all votes in. In terms of percentages, it is at 50.8% to 49.2%. While close, there are less than 800,000 votes left in the state to be counted, leading most outlets to call the race for the defeat of Prop 32 on Tuesday.

Prop 32 Fails

The No on Prop 32 group, which had opposed the Proposition all year, rejoiced on Tuesday, saying in a statement that, although close, it was defeated. Shortly after the statement, the AP called the race.

Jot Condie, President and CEO of the California Restaurant Association, noted after the race was called on Tuesday that “We are encouraged that California voters rejected this proposal that would have further driven California’s out-of-control cost of living crisis. Voters know who pays for wage mandates like Proposition 32 – they do. They’re sick of the high cost of living and they are clearly associating California’s laws and mandates as significant contributors. In a word, they are saying ‘enough.'”

Yes on Prop 32 has yet to admit defeat as of Tuesday night, saying in a statement “As the last 25 years have taught us, it’s unwise to declare victory prematurely. When the Associated Press, which we all can regard as independent minded, declares an outcome of Prop. 32, then we will assess.”

However, most proponents noted that the race was over. United Food and Commercial Workers (UFCW) 770 President Kathy Finn added that “Proposition 32’s failure to pass is disappointing for all Californians who believe that everyone who works should earn enough to support their families.”

For those tracking the Proposition, the defeat was noted as not being surprising considering the latest polling.

“A huge shift happened in California in the last several months,” said Bernard Warren, an analyst who tracks minimum wage changes, to the Globe on Tuesday. “Everyone needs a job right now, and they were finally listening to businesses who have been struggling. Voters also saw what the fast food minimum wage did job wise. Some exit polling showed a larger than expected number of lower wage voters voting this Proposition down, and that’s likely because either they or someone they know had been fired or had their hours reduced by the fast food minimum wage law.

“You also need to remember that a lot of people are currently working for small businesses that are hit harder by minimum wage gains than corporations. Opponents had been trying to show this as corporate greed, but most opponents were not part of huge companies. A lot of them were mom and pop stores or local businesses with thin margins.

“Voters were economically focused this election. That mindset helped Trump, it helped the GOP get the House and Senate, and even in blue states like California, it led to Prop 32, which had been sure fire to pass earlier in the summer, to fail.”

Total vote totals are expected to be released in early December.