Robert Gehl reminds us that liberals promised us that by raising the minimum wage in Seattle, all sorts of glorious things would start happening. You just wait and see, they said. It’s gonna be awesome.
So they did. The minimum wage went up to $11 per hour in April 2015, then bumped up to $13 per hour at the beginning of 2016. By January2016, it will be bumped to $15 per hour and increase every year after that commensurate with inflation.
I won’t bore you with their rationale for this. Why they insisted that – somehow – raising the cost of labor couldn’t possibly be bad for business, for the economy, consumers or ultimately the employees they claim to want to help.
Let’s just look at what the result is, 15 months after the incremental rise began. It’s not good.
First, according to The Washington Post, wages would have likely risen anyway, making a mandated increase unnecessary. As a result, some workers are earning more per hour, but those workers are working fewer hours and there are fewer of them.
One study concluded that overall workers’ earnings in Seattle increased an average of $5.54 per week. Another study concluded that they actually dropped by $5.22 per week. Here’s how they put it: “If employers cannot stay in business while paying their staff more, they will either hire fewer people or give their workers fewer hours. As a result, even if wages per hour increase, workers’ total earnings could decline.”
Well, duh. This is news to them?
[Researchers] attributed a wage increase of about $0.73 an hour for low-income workers to the minimum wage, and another $0.45 an hour to the improving economy. After the increase, Seattle’s workers got about seven more hours in a quarter. Workers’ hours increased even more in other parts of the state, however, leading the researchers to conclude that the minimum wage reduced the number of hours worked quarterly by 3.2, roughly 15 minutes each week.
Those figures do not include workers without jobs. The economists estimated that the minimum wage decreased the share of workers with jobs by about 1.2 percentage points.
So at best, it’s a wash. At worst, it was just a bad idea that cost jobs and hurt the working poor.
And guess what? It’s going to get worse. In January, the minimum wage will go up another $2 to $15 per hour.
One of the economists doing the study knows precisely what will happen:
Jacob Vigdor, an economist at the University of Washington and one of the authors of the report, speculated that technology could limit the benefits of increasing the minimum wage. If it becomes easier for employers to replace their workers with machines, they will be more likely to respond to wage hikes by making fewer hires.
“The economy has changed in ways that give businesses more options for cutting back on labor,” Vigdor said. “If you are a person who is trying to make ends meet at the lower rungs of the economic ladder, you might be used to this idea that forces conspire against you. The minimum wage is an effort to try to keep some of these forces at bay, but there are definitely questions about how effectively and for how long.”
We have a minimum wage. It’s on the books and it’s not going away, no matter how much conservatives yell and scream.
So having one and ignoring the purpose of it is stupid. But it’s equally stupid to pretend that a fifty percent increase (from $9.96 to $15 per hour) will not hurt small businesses and workers and cause prices to increase.
But liberals will ignore this, until they do it again, then publish a story showing no or negative impact – ignore it – and do it again.