At the start of the year, the Seattle suburb of SeaTac raised the area’s minimum wage to $15, and the consequences are now starting to be felt. And it’s not just the unions who championed the effort, or those who still have jobs, that are feeling them.
Over the last few months, a few things have happened:
- Managers have taken more responsibilities on themselves, instead of hiring more workers.
- Businesses have laid off workers, or eliminated their plans to hire more.
- Area parking now comes with an added “living-wage surcharge.”
- Hotels have cut employee benefits, free food, and overtime.
Shocking: when bad ideas are put into place, there are consequences.
The one thing that you won’t read in any of the articles published since the law took effect are stories about businesses hiring more people. Business owners have reported a marked increase in job applications, presumably from those hoping to benefit from the higher minimum wage; but that has not translated into an increase in employment.
This, too, is predictable. Only higher-quality workers will be getting the higher-wage jobs; now that businesses have a higher floor for the wages they pay, those less qualified will not be getting hired.
What would be really fun to see is an experiment that did the opposite: lower the minimum wage to $5 – or even $0. This would allow businesses to pay what labor (the supply) and commerce (the demand) required.
It would also be interesting to see what kind of job creation and economic gains would result. Of course, it is almost impossible to imagine that in a progressive haven like Seattle, but one can always dream…
Editors Note: This article is referencing the minimum wage law implemented in SeaTac (the incorporated area immediately around the Seattle-Tacoma airport); the city of Seattle itself passed a bill yesterday that would raise its minimum wage to $15 an hour as well, making it the highest minimum wage for any major city in the country.