Prop 206: What Will It Mean?

Posted on December 14, 2016 • Category: Job Creation

By Zackary Moran-Norris

Earlier this month, Arizona voters approved Proposition 206, a ballot initiative that boosts the state’s minimum wage from $8.05 per hour to $12 per hour in 2020 and requires employers to provide paid sick time off from work.

The proposition has sparked statewide debate in recent months but it passed with a surprisingly large margin with 58 percent of voters saying “yes” and 41 percent voting “no."

Kathy Ortega, a fast-food worker in Tucson, was one of the over 1,400,000 Arizona voters who supported the measure.

“If we had sat back and done nothing, I don’t think they would have raised it,” said Ortega. “I think we needed to get with the times because the cost of living is so high that people like me can never get ahead.”

Ortega supports her disabled husband and her three children all while helping look after her three grandchildren. She said that even the immediate increase to $10 per hour beginning January 2017 will make a huge difference for her family.

“Now I don’t have worry so much about things like the lights getting turned off or buying my daughter shoes for school,” Ortega said.

In 2015, about 2.6 million U.S. workers earned wages at or below the federal minimum wage, according to a report from the U.S. Bureau of Labor Statistics. Calculations from the 2013 BLS Current Population Survey data show that nearly 58,000 of 1.4 million hourly employees in Arizona earn minimum wage or less.

“Voters have been on our side for a long time and they agreed that it was time for Arizona to get a raise,” said Suzanne Wilson, representative at the Arizona Healthy Working Families Initiative, one of the groups that advocated for Prop 206.

While the benefits of Prop 206 for struggling families is indisputable, many fear that it will hurt small businesses because of increased labor costs that could mean less jobs, less hours and price hikes.

Carlos Ruiz, the owner of a Tucson-based metal supply business, manages five employees and says that the measure will be particularly burdensome to small businesses like his own.

“My entry-level wage for employees is $12 per hour and eventually I’m going to have to make my beginning wage $14 or $15 per hour,” said Ruiz.

Ruiz says that he gives his entry-level employees raises as they progress but Prop 206 ultimately puts a strain on that liberty from an employer.

“Now it’s like I have to give them raises just to keep them above what someone with no experience or work history would make,” said Ruiz. “This is something that should be between the employer and employee.”

Ruiz also said that cutting hours and making changes to his sick leave policy are options he will evaluate in the future.

Prop 206 will begin to take effect in 2017 as the minimum wage increases to $10.