Study Finds That Seattle’s $15 Minimum Wage Is Costing Jobs

Daniel Lattier | June 26, 2017 | 5,505

Study Finds That Seattle’s $15 Minimum Wage Is Costing Jobs

In 2014, the uber-liberal Seattle City Council passed a law mandating that all businesses in the city raise their minimum wage to $15 by 2021.

The most noted advocate of the law is the openly Socialist councilmember Kshama Sawant, who believes it will help “tackle the chasm of income inequality and social injustice.”

The law garnered national attention, and caused many progressive business owners to break ideological ranks on this issue.

Today, a team of professors and researchers at the University of Washington (UW) published a report evaluating the impact of Seattle’s minimum wage thus far.

The results of the report, as summarized by The Seattle Times:

“Seattle’s minimum-wage law is boosting wages for a range of low-paid workers, but the law is causing those workers as a group to lose hours, and it’s also costing jobs.”

According to the study, pay for low-wage jobs in Seattle has increased by about 3% since 2014. However, that wage increase has been accompanied by a 9% reduction in hours for such jobs, which comes to a loss of about a $125 in earnings per month for the workers.

In addition, “the report also estimated that there are about 5,000 fewer low-wage jobs in the city than there would have been without the law.”

The Washington Post interviewed Massachusetts Institute of Technology economist David Autor about the report, who said it was “very credible” and “sufficiently compelling in its design and statistical power that it can change minds.”

A 2016 report from the same UW team—who were commissioned by the City of Seattle to study the effects of the law, and claim to have “no ideological commitment”—noted similar trends, and that recent increases in wages were not necessarily due to the mandated minimum wage hike, but to a “robust regional economy.”

Sawant was “deeply concerned” with the 2016 UW report, and published a public letter condemning its results. In the letter she wrote:

“I’m not only concerned that we’re in danger of drawing erroneous conclusions about Seattle’s minimum-wage increase—I’m concerned about the consequences that could have on the nationwide fight for $15 (per hour).”

It remains to be seen how Sawant and other $15 minimum wage advocates respond to this latest report. It can indeed be frustrating when economic data doesn’t match up with one’s ideological presuppositions.



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