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Could minimum wage increase impact California apparel industry?

While many employee advocates throughout California are celebrating the recent minimum wage increase signed into law by Governor Jerry Brown, others are not as convinced. The bill now turned to law enacted a gradual minimum wage increase up to the year 2022. The end-result being a minimum wage in California of $15. New York also followed suit with a similar law. The political tide seems to be turning on wage and hours laws as mainstream media is focused more intently than ever on this year's primary season.

However, many in the apparel industry are concerned at the potential negative impact this could have.

Exodus and Outsourcing

For years, California was considered the capitol for the garment and apparel industry. However, with many companies starting to utilize outsourcing overseas, the competition became stiff and almost impossible to keep up with. American Apparel employed approximately 4,000 workers in Southern California. With news of the minimum wage increase, the company had to lay-off five hundred of its employees. Many experts believe this is just the beginning for a downward turn in the apparel industry. As advocates against the new law seem to tout the idea that a minimum wage increase does not do anything for those without a job.

Manufacturing apparel has been on the decline even before the minimum wage increase. According to the Bureau of Labor and Statistics, garment maker employers have gone down thirty-three percent since 2005. Although the apparel industry is certainly not dead in California, it remains to be seen just how much of an impact new wage and hour laws in California will bring.

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