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NBER finds Seattle wage increase reduced earnings
This paper evaluates the wage, employment, and hours effects of the first and second phase-in of the Seattle Minimum Wage Ordinance, which raised the minimum wage from $9.47 to $11 per hour in 2015 and to $13 per hour in 2016. Using a variety of methods to analyze employment in all sectors paying below a specified real hourly rate, we conclude that the second wage increase to $13 reduced hours worked in low-wage jobs by around 9 percent, while hourly wages in such jobs increased by around 3 percent. Consequently, total payroll fell for such jobs, implying that the minimum wage ordinance lowered low-wage employees? earnings by an average of $125 per month in 2016. Evidence attributes more modest effects to the first wage increase. We estimate an effect of zero when analyzing employment in the restaurant industry at all wage levels, comparable to many prior studies.
Minimum Wage Increases, Wages, and Low-Wage Employment: Evidence from Seattle |
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It says right there it cut their "earnings" on average. As a business owner if I only have x amount of dollars to spend on "help" that's all I have to spend no matter what the hourly is. |
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So the whole plan is a complete failure, as both business owner and employee became worse off after the minimum wage increase. |
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Minimum wage workers in expensive areas require more money as "minimum" wage to pay higher rent, gas, utilities & food costs, like where I live. |
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"Consequently, total payroll fell for such jobs, implying that the minimum wage ordinance lowered low-wage employees’ earnings by an average of $125 per month in 2016." so minimum wage workers ended up with LESS money, so they certainly are not better off, business owner is not better off, and neither is the tax payer as that $125 reduction in earnings likely has to be covered by government assistance. So like I said, it's a complete failure. |
Lower skilled jobs are being automated, robotized or eliminated perhaps?
To be expected ... |
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Companies raise wages to pay BETTER than minimum wage to be competative with those paying minimum wage. We've been through this before in California you're spreading false propaganda. Example: I have a store with 2 minimum wage employees ($5 an hour) and one manager ($6 an hour) working a total of 120 hours a week. Minimum wage goes up to $6 an hour. Instead of paying 3 employees minimum wage @ $6 an hour, I raise the wage of the manager to $7 an hour, taking it out of the minimum wage bracket. Instead of having 3 minimum wage employees, I now have 2, and a manager @ $7 an hour (above minimum wage). See how that works? Use your mind. |
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