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KCBS Cover Story: San Jose Readies For Economic Impact Of New Minimum Wage

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(CBS)

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SAN JOSE (KCBS) – On Monday, 40,000 people who work in San Jose will be getting a raise thanks to the November 2012 election win for Measure D, which raises the base pay in San Jose from $8 to $10 an hour.

Backers were outspent during the campaign by two to one, but Measure D still garnered 60% of the vote, bringing much needed relief to the city’s minimum wage workers.

“It’s more money for books, for food that I spend on campus, for all my little expenses here and there that I use for school,” said one SJSU student who works two minimum wage jobs while juggling her studies. “Two bucks an hour is a lot of money.”

Mayor Chuck Reed agrees, and that’s precisely why he’s actually concerned about the impending implementation of Measure D.

“I’m concerned about the people who are likely to lose their jobs as the minimum wage goes up,” he explained. “Small businesses in particular will make accommodations. Some of them will absorb the costs, some will pass it on to their customers, and some will have to decrease jobs and lay people off.”

“The question is, is it a few hundred or a couple of thousand? Nobody really knows, but I’m concerned about the people who are going to lose their jobs,” he said. “Nevertheless, the voters have spoken. So what happens will happen.”

For some businesses, it already has happened: Pizza My Heart franchise owner Chuck Hammers elected to implement the minimum wage increase at all six of the chain’s San Jose locations immediately after Measure D’s victory.

“I knew it had to come,” Hammers said, “and after analyzing it, it wasn’t going to be that big of a deal.”

“I think it’s a good signal to your employees that you do it early and it’s not saying ‘hey we have to give you this’ but ‘hey we value you and we want to give you this now,'” he continued.

“The employees love it and we bumped prices a little bit, about 3%, which wasn’t a big deal. Customers don’t mind it. And the employees are super happy.”

(Copyright 2013 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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