Proposition 32: Measure to Raise California's Minimum Wage Rejected

Updated at 7:30 p.m. Nov. 19

A California ballot measure aimed to modestly increase the statewide minimum wage was denied by voters.

Two weeks after the election, the Associated Press declared Proposition 32’s narrow defeat on Tuesday night, with 49.2% voting “yes.”

The measure would have provided an estimated 2 million Californians a raise, to $18 an hour by 2026 — up from the current statewide minimum wage of $16 an hour. The increase would’ve  benefitted workers in some of the state’s lowest-paid jobs, including cashiers, farmworkers, food preparers and home health aides.

Joe Sanberg, one of the main proponents of Proposition 32, said he and other supporters were disappointed by the results, but saw them only as a “temporary setback.”

“This is one bump in the longer term journey to make California a place where everyone who works can afford life’s basic needs, and change doesn’t always occur in a straight line,” said Sanberg, an anti-poverty activist and investor who spent nearly $12 million of his own money to back the measure. “We have to be resilient and keep forward with the mission to end poverty in California.”

Proposition 32 opponents, including the California Restaurant Association and California Grocers Association, among a host of other business trade groups, argued that higher payroll costs would force businesses to cut jobs and increase the price of products and services to stay afloat.

Most economic studies show minimum wage raises have little or no impact on jobs overall, although they can lead to small price increases. Researchers at UC Berkeley studying the fast-food minimum wage raise California implemented in April, for instance, found months later that menu prices had risen about 3.7%, but the policy had not adversely affected employment.

California’s Legislative Analyst’s office found Proposition 32 could have increased or decreased costs for state and local governments due to a more expensive payroll, but also yielded savings due to fewer people enrolling in Medi-Cal and other safety net programs.

A growing number of voters in blue and red states have approved dozens of minimum wage raises in recent decades, a recognition that pay has not sufficiently kept up with the cost of living, according to economists.

The U.S. economy has largely rebounded from the pandemic, with a relatively low unemployment rate, according to experts. But inflation remains a top concern for voters.

Just weeks before the election, support for the measure hovered at 47%, just short of the majority it needed to pass, according to two statewide polls.

Enrique Lopezlira, a labor economist at UC Berkeley, said the low-visibility campaign for Proposition 32, including few advertisements, could be playing a role in the results, particularly in an election with 10 state propositions on the ballot.

“There’s a lot of competition for people’s attention during elections,” said Lopezlira, who directs the university’s Low-Wage Work program. “It could be that it was just a lack of information about what it would mean to pass the proposition. So I’m not sure that I would attribute it to anything specifically of the minimum wage itself, but more of maybe the strategies the campaigns used during the election cycle.”

Two other states with minimum wage raises on the ballot, Alaska and Missouri, approved the hikes.