Voters in Oakland will decide in November whether to raise the minimum wage in their city, but from early coverage of the issue, it seems that the nonprofit sector is sending mixed messages that threaten to cast income inequality aside in favor of protecting the status quo. Voters should demand more accountability from these agencies to ensure that an honest dialogue emerges in the coming months.
Under Oakland's proposal, which is backed by the Lift Up Oakland Coalition, the hourly base wage would increase by 36 percent, from $9 to $12.25 starting March 1. A recent article in the San Francisco Chronicle found that leaders of the Youth Employment Partnership said that they could be forced to cut the jobs they offer by 30 percent if voters approve the wage hike. The partnership's leaders blamed the potential cuts on the higher minimum wage and the fixed amount of grant money they receive. In other words, a boost to the minimum wage for those workers who need it the most would result in fewer jobs for them overall.
This is an example of nonprofit executives not being creative and unwilling to adapt to changing circumstances. If the pie is shrinking, they should try to make a bigger pie, not toss up their hands and surrender. (It's interesting that these same leaders supported an alternative �" and competing �" plan that would have raised the minimum wage more gradually, and included so many exemptions that we wonder whether many workers would even see an increase. Smartly, the Oakland City Council last week rejected that plan, so only Lift Up Oakland's measure will be on the ballot.)
Programs that provide job-training skills are sorely needed in Oakland, which lags behind San Francisco in economic growth. The programs help all sorts of people struggling to get back on their feet, including teens and parolees. But to cry foul over a wage hike that would help its clients is unsettling. Those nonprofit leaders should be looking for new revenue sources and the boards should get off their collective rear end and do some serious fundraising.
There's nothing new about nonprofit budget woes. We cover them regularly. But the organizations that are successful quickly adapt. That usually means recruiting board members who can raise money from the private sector. While Oakland may not have the number of tech firms and other corporations as San Francisco, those that call the city home should be willing to step up to the plate to help the nonprofits. Relying on government grants alone is risky for any organization. We've seen more HIV/AIDS nonprofits reach out to the private sector because federal dollars have decreased year after year. Heck, Oakland nonprofits could think more regionally and approach San Francisco tech firms, since many of their employees live in the East Bay. Several have recently started giving back to the San Francisco community and could expand their giving to other locales. Income inequality is a regional issue that requires a regional response.
The nonprofits must also trim administrative fat on occasion. This can mean pay cuts for executive directors, streamlining administrative duties, or other cost-saving measures. We've said this before but it bears repeating: people who go into nonprofit work should not expect to become wealthy.
In short, Youth Employment Partnership and similar agencies should not accept that they would need to cut services if the minimum wage measure passes. If anything, they should increase capacity so that more young people can get a step up not a step down. Helping at-risk young people is not easy, and these leaders should quit whining about how they will be affected by a higher minimum wage and adapt to the changes that must come with raising the minimum wage.