Raising the minimum wage for entry-level City of San Antonio workers from the current $13 to $15 – which has come to be regarded as a national standard – has been a hot topic of discussion around the city for more than one year. The majority of City Council agreed Wednesday that “getting on a path to $15,” at least over the next four years, is the ultimate goal it should strive for.
Organizations, such as the local employee union, Service Employees International Union Texas (SEIU Texas), and COPS/Metro, have helped lead the charge for upping the hourly minimum wage to $15, citing the difficulties economically disadvantaged people have providing for their families with current compensation. Another argument has been that other cities in the nation, such as Seattle, have achieved that wage goal, but the cost of living in San Antonio is much lower compared to such places, City Human Resources Director Lori Steward told Council during her presentation on employee compensation and benefits.
Raising the minimum wage in San Antonio – depending on the rate of increase – also could be very costly to the City, Steward said.
Some of the about 8,000 civilian City employees are on a 10-step pay plan, where they can earn pay increases throughout their careers. Steward said that it generally takes about one year to move from one “step” to another. Currently, those at the lowest end of the pay range can climb six steps while those at the highest end – who generally have more advanced skill sets or experience – can advance 10.
The step program has its advantages, but raising the base minimum wage to $15 on such a system would mean wage compression, Steward explained, meaning that the increased wages for entry-level employees, such as maintenance workers, would come close to equaling those in higher-paid positions.
So, someone who has been working for the City for five years could at the same time be earning nearly the same salary as someone who has only been working there for five months, said City Manager Sheryl Sculley.
In order to avoid that, the City would have to up the wages of those higher-paid employees on the step pay system. Sculley also warned that a $15 minimum wage for entry-level jobs could lead to “unintended consequences,” such as making those jobs tougher to get for less experienced workers since higher wages will attract higher skilled people.
If the City were to increase the minimum wage to $15 in the next fiscal year, it would cost $5.3 million, Steward said, with a total cumulative cost over the next four years of $21.2 million. In contrast, if they did so through a four-year phase-in process, starting in 2017 with 50-cent increments each fiscal year, it would cost $11.3 million.
Those numbers, however, only portray the total amounts for adjusting the base pay of entry-level employees, said the City Chief Financial Officer Ben Gorzell. City staff didn’t have data showing the adjusted incremental steps in the wage system to account for the increased pay of every employee, but estimated it would cost around $150 million in total.
Councilman Rey Saldaña (D4) is determined for the City to stay “on track” in its considerations to bump up the hourly wages, something he believes would respect the dignity of the work those in entry-level positions do. He suggested increasing the minimum wage to $15 and not adding the incremental steps on the system for the category of the lowest-paid employees. This means they wouldn’t have opportunities for annual wage increases as dictated by the step system, but instead could get those increases by assuming higher-level and thus higher-paying jobs.
Seeing that positive wage adjustment would go a long way for that entry-level population, he said, the majority of which live within the city limits and contribute greatly to the local economy.
Councilman Ray Lopez (D6) and Councilwoman Shirley Gonzales (D5) also advocated for reaching that $15 goal over a phase-in process, ideally moving as quickly as possible. Gonzales asked for City staff to bring more information to the next budget work session on what two-year and three-year phase-in processes would cost in order to make a more informed decision in future budget discussions.
Mayor Ivy Taylor suggested considering the adoption of a merit-based wage system, since employees on the step pay plan are rewarded annually for remaining in their positions while executive City employees are financially rewarded for good performance and can’t take advantage of step wage increases. Additionally, she cautioned her Council colleagues about making decisions on upping the hourly minimum wage to $15 until more data on its economic impacts to the City is presented to them.
“I have great hesitance to us adopting solutions from other communities for San Antonio,” she said. “I think we really need to be focused on what our challenges are here and not get caught up in national debates. We have to focus on what our circumstances are here.”
The City will the vote on the overall fiscal year 2017 budget on Sept. 15.
Top image: San Antonio City Manager Sheryl Sculley gives a brief overview of the City’s 2017 budget on Aug. 24, 2016. Photo by Kathryn Boyd-Batstone.