Business Review Board / August 17, 2016

Seattle’s False Positive

The minimum wage increase is creating a bigger problem than it solves.

Seattle is experiencing a false positive. When the city passed its ordinance to gradually raise the minimum wage to $15, there was much rejoicing among leftists, who touted it as giving everyone a “living wage.”

Recently, however, the University of Washington conducted a study on the impact of the minimum wage increase on both the city of Seattle and on the rest of the state. What the study found was that as Seattle’s minimum wage rose so did wages in other similar areas of the state that had not enacted the minimum wage increase. In other words, the wage increase both in Seattle and in the other areas in Washington state had more to do with a strong economy that grew triple the national average, than with Seattle’s mandate.

But even with this seemingly positive growth in wages, Seattle saw a reduction in employment and in average hours worked. The fact was fewer low-wage earners were being hired and many of these low-wage earners’ hours were being cut. The report stated that individuals were taking jobs outside the city at “an elevated rate compared to historical patterns.”

Liberals may think it a successful policy, but, ironically, Seattle will only continue to become even less affordable for lower income earners than it was prior to this socialist policy. How is that a “living wage”?

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