Seattle's minimum wage hike hurting low-level workers, study says

Paterniano Del Favero
Giugno 28, 2017

The University of Washington study found the number of low-wage jobs - and hours available to workers in those jobs - dropped in Seattle when the minimum wage rose to $13 in 2016. Experts cautioned that the effects of the minimum wage may vary according to the industries dominant in the cities where they are implemented along with overall economic conditions in the country as a whole. "There is no reason", he said, that Seattle's employers of low-paid workers "should be so much more sensitive to wage increases".

In a 2007 peer-reviewed study conducted by economics professors from Cornell University and San Diego State University, researchers examined U.S. Census data from 1979 to 2003 to estimate the effects of minimum wage increases on state poverty rates. It's unclear whether the study results will impact the ordinance that is expected to pass here. As America Rising Squared spokesman Jeremy Adler states, "This important study ought to be a big wake-up call that the "Fight for $15" minimum wage effort is actually hurting those they say they want to help - reducing incomes and eliminating economic opportunities for low-income Americans who need them most". In fact, some cities want to raise their minimum wage as high as $15 an hour in the years to come.

However, critics of the University of Washington study suggest that the loss of hours could be contributed to the boom in Seattle's market around the time the minimum wage was raised from $11 to $13 in 2016 and possibly not the wage raise itself. The study looked at the number of hours workers entered in since the mandatory wage hikes. As The Washington Post pointed out, the University of Washington study did not include large employers with locations in and outside of Seattle.

"When we perform the exact same analysis as the Berkeley team, we match their results, which is inconsistent with the notion that our methods create bias", he said. Vigdor said multisite businesses were actually more likely to report staff cutbacks. The study finds that already, "some employers have not been able to afford the increased minimums".

It may still be too early to tell what the effects of a higher minimum wage on Seattle will be as the minimum continues to increase, but it does give a little insight to a possible negative outcome of the experiment. "For a family of four with both spouses making the minimum wage, their federal tax will increase from $4,106 to $7,219, payroll tax will increase from $2,579 to $3,869, their earned-income tax credit (EITC) will be reduced from $596 to zero ... and the $2,400 food-stamp credit will be lost".

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