Jordan Candler / August 11, 2015

Minimum Wage Effects Already Evident in Seattle

Some workers got a raise, but others lost their paychecks altogether.

Is Seattle’s minimum wage experiment already battering the local restaurant industry? The preliminary answer appears to be yes. On April 1 — not even six months ago — a new city ordinance took effect, which initially set the minimum wage at $11 an hour. That rate will increase to $15 over the next three to seven years (contingent on the size of the company). However, despite the law being in its infant stage — that is to say, the worst is still to come — jobs are already disappearing. American Enterprise Institute’s Mark J. Perry dug into the data and uncovered these startling statistics: “Emerald City MSA started experiencing a decline in restaurant employment around the first of the year (when the state minimum wage increased to $9.47 per hour, the highest state minimum wage in the country), and the 1,300 job losses between January and June is the largest decline over that period since 2009 during the Great Recession (data here). The loss of 1,000 restaurant jobs in May following the minimum wage increase in April was the largest one month job decline since a 1,300 drop in January 2009, again during the Great Recession.” So not only has the city lost 1,300 restaurant jobs, the vast majority of those happened after the new ordinance took effect. Meanwhile, Perry adds, “non-Seattle MSA restaurant employment in Washington increased 3.2% and by 2,800 jobs.” That makes it difficult to spin Seattle’s job losses as a mere coincidence. And for those who claim unrealistic minimum wage laws are good for fast food prices? Think again. To be clear: We want everyone to earn higher wages — just not by government mandate overriding the market. Otherwise, some workers get a raise, while others lose their paychecks altogether.

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