Study Says Seattle Minimum Wage Hikes Are Bad for Jobs
A University of Washington-based study has found that hikes in minimum wage have been hurting low-income hourly wage earners in Seattle.
The report, published by the nonprofit research group National Bureau of Economic Research, suggests that the rises in minimum wage to $15.00 have been impacting the monthly earnings that hourly wage earners make.
Many economists, however, are criticizing the study, citing previous studies which suggest that minimum wage hikes have had little effect on employment levels.
The study, based on research by the University of Washington, has found that the increases in minimum wage have led some employers to cut back on their employee’s hours of employment. Hourly wage earners in Seattle were found, on average, to be working nine percent fewer hours than before the wage increases. Consequently, they are taking home $125.00 less in monthly income because of the most recent hike in minimum wage.
The University of Washington’s study followed another recent study, by the University of California-Berkeley, which found that the minimum wage hikes in Seattle have increased the earnings of low-wage earners without costing them their jobs.
However, the University of California-Berkeley only conducted its research on Seattle’s restaurant businesses. The University of Washington, in contrast, carried out its research across various industries and it employed a richer source of data.
The minimum wage in Seattle jumped from $9.47 per hour in 2014 to $11.00 per hour in 2015. It increased again in 2016, from $11.00 to $13.00 per hour. The minimum wage laws that are currently in effect in Seattle require all businesses to raise their minimum hourly wages to $15.00 by 2021.
One of the authors of University of Washington’s report, Jacob Vigdor, said that the restaurants in Seattle may not have cut back on employee hours, but they did change their policies in response to the minimum wage hikes.
According to Vigdor, after the wage hikes, many restaurant owners ended up hiring more skilled and productive workers, who could add greater value and generate more revenue for their restaurants.
Regardless, economists on both sides of the argument remain at odds with each other over the impacts of minimum wage.
“Seattle’s $15 minimum wage may be hurting workers, report finds,” USA TODAY, June 27, 2017.
“A ‘very credible’ new study on Seattle’s $15 minimum wage has bad news for liberals,” The Washington Post, June 26, 2017.