Business Assistance Living Wage Campaigns

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New Orleans               Support is increasingly lining up in New York City and elsewhere not simply for living wage ordinances, but more specifically for a more targeted type of living wage program where public dollars are partnered with private development.  These so-called “business assistance” living wage ordinances that also draw from experiences with “community benefit agreements” and other equitable urban policy initiatives are extremely important for any city trying to use its tax revenues to not only create new jobs and opportunities, but to also make sure that the benefits of such investments are broadly shared by the citizens.

In the current fight in New York City an oft cited study that buttresses the case for coupling public investment in private development with living wage improvements on such projects was written by T. William Lester and our old friend and comrade, Ken Jacobs from the University of California at Berkeley’s Center for Labor Research and Education.  The study, “Creating Good Jobs in Our Communities:  How Higher Wage Standards Affect Economic Development and Employment,” put together a list of cities that had enacted “business assistance living wage” ordinances and created a database to compare them to a similar set of cities to determine in a unique way whether or not cities had hurt their growth and job development with such policy initiatives.  The cities  had a good dose of California in them, not surprisingly, but also included a good smattering from around the rest of the country, making the work truly national in scope.

The results contained good news for all of us who have advocated and organized for such policies to be enacted in our cities:

“Economic development wage standards are one tool that a city can use to create jobs of greater quality. We have compared two sets of cities in order to assess the effectiveness of such laws—those with enforced business assistance living wage laws and those without—and found that there is no loss in the number of jobs due to the living wage requirement. It appears that, even during hard times, economic development wage standards are an effective tool for increasing wages in a city without sacrificing the number of jobs.”

This work builds on the path breaking work done by Dr. Robert Pollin of the University of Massachusetts at Amherst that had established in Los Angeles and later, working with ACORN in both New Orleans and Florida, that the any adverse impacts were at worst negligible, and at best wildly positive.  Walmart ran from ACORN’s big-box proposed ordinance in Chicago in 2006 which would have coupled business assistance with their development and pulled up stakes in Sarasota, Florida when we won an ordinance requiring living wages on such developments in that city, but these studies seem to conclusively argue that they simply left money on the table, rather than allowing cities to develop in equitable and sustainable fashion.

With the first hints emerging that we may be coming out of the recession, we need to dust off all of these reports and initiatives and move more aggressively to reassert these agendas in North American cities and around the