The San Diego City Council’s Cost of Living Committee has taken significant steps to advance the debate on wages by unanimously supporting a proposal to raise the minimum wage for tourism industry workers from $17.25 to $25 per hour. This bold move, which could see pay increase by 45%, is aimed at addressing the high cost of living faced by many workers and is set to take effect on January 1, 2026, if passed by the full City Council. The proposal, championed by Councilman Sean Elo-Rivera, is anchored in the reality of San Diego's soaring living expenses and the need for fair compensation for those holding pivotal roles within the city's tourism sector.
Highlighting the urgency of the initiative, Elo-Rivera remarked, "They’re struggling to pay rent, put food on the table--and keep up with San Diego’s skyrocketing cost of living.” His comments resonate with numerous workers who have voiced the challenges of surviving on current wages. Citing the Massachusetts Institute of Technology's living wage calculator, he noted the necessity for wages to reflect actual living costs, with calculations indicating singles need over $30 per hour just to make ends meet.
While the proposal garnered support primarily from labor unions and hospitality workers, voices opposing it were equally loud. Business leaders from across the tourism sector, including representatives from the San Diego Regional Chamber of Commerce and the San Diego County Lodging Association, expressed their grave concerns during the public debate. They argued vocally against the ordinance, claiming the substantial wage hike would inevitably lead to layoffs and reduced overall economic activity within the region.
Robert Gleason, chairman of the San Diego County Lodging Association, highlighted these fears, stating, "The wage increase would lead to layoffs of hotel workers and reduced tax revenues for the city.” He pointed to data from Oxford Economics, which estimates the $25 minimum wage could lead to the elimination of nearly 4,400 jobs, contraction of regional sales by $333 million, and result in the loss of $57.8 million in tax revenue across various levels of government.
Opponents of the proposal warn of dire consequences if passed. “This is going to help some little guys at the expense of other little guys. What a boneheaded idea,” said Michael Sawyer, who co-owns a restaurant. Critics stress the danger of setting one industry apart during challenging economic times, reiterate the lessons learned from previous, experience-backed wage increases, like the statewide AB 1228 law, which negatively impacted job numbers and led to store closures when fast-food wages were similarly raised.
Conversely, proponents argue the tourism industry has the necessary financial flexibility to adapt to wage increases. Brigette Browning, president of the UNITE HERE labor union, dismissively countered claims the industry couldn’t sustain higher wages by stating it was “ludicrous” to suggest wealthy corporations could not afford to pay their workforce adequately. Pointing out the industry's collective benefits, she noted, "This idea... cannot afford a livable wage is ludicrous,” emphasizing the drastic difference between the wealth generated by tourism profits and the wages offered to many front-line workers.
The dynamic of the debate mirrors previous discussions around wage increases seen across the city. Elo-Rivera mentioned these arguments have been recurring throughout economic discussions for decades, stating, "Every time we talk about increasing wages for workers, making things fair for workers, they tell us the economy will break.” Despite the expressed concerns from opponents, Elo-Rivera remains firm on his position and has asked industry leaders not to predict doom if such policies are implemented.
Your friendly neighbor Councilwoman Marni Von Wilpert introduced the notion of phasing the wage increases, allowing businesses to adjust over time rather than imposing the full increase immediately. “I do think absorbing a $25 minimum wage overnight would be very hard on a lot of these businesses, who we care a lot about,” Von Wilpert indicated, reflecting on pragmatic approaches to the establishment of minimum wage legislation.
Despite the unanimous vote supporting the proposal, the next steps involve crafting the official ordinance, expected to be drafted for discussion at the next meeting scheduled for June. Assuming it proceeds through the necessary legislative procedure, the San Diego City Council might vote on the ordinance during the summer, setting the stage for what could reshape the economic structure of the tourism industry.
Many stakeholders are watching the San Diego City Council's actions closely, recognizing the broader potential ramifications for the regional economy and employment levels. The outcome could serve as both a bellwether for similar legislative actions across California and as the latest chapter in the long-standing conversation surrounding minimum wage and economic equity.