The cost of living is going up, but pay raises are coming for some people. The City of San Diego will increase the minimum wage to $16.30 on Jan. 1, 2023 — $1.30 higher than the $15 rate in 2022, making it the single largest increase in San Diego’s history. For a full-time worker, this would amount to a $33,800 annual salary.
In May 2022, the city projected minimum wage would only increase by 25 cents to $15.25 at the start of 2023 — and it would reach $16 at the start of 2026. It also anticipated California’s minimum wage would remain at $15, but the first sign of change came when the state announced it would increase its minimum wage to $15.50 at the start of 2023, effective for all employees.
Why the big increase?
In July 2016, the City of San Diego passed the Earned Sick Leave and Minimum Wage Ordinance , allowing San Diego to set its own minimum wage — provided it’s higher than the state + federal rates. Starting in 2019, the law also required this rate to increase as the Consumer Price Index (CPI) rises.
In August 2022, the CPI rose 8.1% when compared to the same month in 2021. The $1.30 increase to the minimum wage roughly matches this percentage — it’s actually slightly higher.
Who will be impacted?
All employers in the City of San Diego will be required to raise their hourly minimum wage to $16.30, regardless of their size. Any employee who works at least two hours a week must receive this pay.
If you currently make more than $16.30/hour, your employer is not required to increase your wage, even if your starting pay was above the minimum.
Locals should also be aware this can impact the cost of services — particularly those dependent on workers receiving minimum wage. Historically, similar motions have resulted in HOA fees to increase or businesses — particularly small + local ones — to raise prices to ensure they can pay their employees.