top of page

RESULTS: Seattle minimum wage increase cost +8,000 jobs, and a loss of $62 million in annual payroll

Updated: Aug 20, 2019

Can't Read? Listen to the Podcast!

I'll begin with a few notable quotes from the study commissioned by the Seattle City Government. Feel free to open the entire 75-page study conducted by the National Bureau of Economic Research by clicking this link.

"Our results are similar to those in Mastracci and Persky (2008) who evaluate an increase in Illinois’ minimum wage. They find that while the state’s minimum wage rose $1.35, “hourly pay for low-wage workers rose by only 15 cents on average” and “hours worked by low-wage workers fell by about two hours per week, resulting in lower weekly earnings,” with the implied demand elasticity being in the range of “two to three” (p. 268)."

"The adverse effects on hours in the final three quarters are greater than the effects on jobs, suggesting that employers are not only reducing the number of low-wage jobs, but also reducing the hours of retained employees."

"This implies that the minimum wage increase to $13 from the baseline level of $9.47 reduced income paid to low-wage employees of locatable Seattle businesses by roughly $62 million on an annual basis."

The following charts are pulled from the study, depicting trends on jobs paying less than $19 per hour. The blue line is what was projected to happen after the wage increase. The black line is what actually happened.

"The study found that while wages for low-earners rose by 3 percent since the law went into effect, hours for those workers dropped by 9 percent. The average worker making less than $19 an hour in Seattle has seen a total loss of $125 a month since the law went into effect." - Seattle Weakly

I believe all the quotes and data from the study speak for themselves, but I want to leave with this one point...

The ongoing war between free-market capitalist and socialist/communist ideology has a completely inappropriate undertone that deserves to be discounted. The Socialist/Communist ideology, regardless of it's numerous failures directly resulting in the starvation or outright murder of hundreds of millions of people- somehow gets to hold the "moral' side of the argument because they are "for the people."

It's time for Libertarians, Conservatives, etc. to take back that obviously flawed narrative. I'll state that again: It's OBVIOUSLY flawed, not possibly flawed.

Time and time again it has been proven that top-down control of economies do not serve the people at the bottom. It's honestly infuriating that somehow people like Bernie Sanders and Alexandria Ocasio-Cortez get to take the moral high-ground in a situation where they obviously have none.

When arguing politics I've switched from one tactic to another, trying to find the best route to changing peoples minds. Here's where I've landed...

It's never good to blame the "victim." Are you in an argument where you're calling out how poor people made their decisions, and it's all their fault for being "lazy?" Guess what- You're never going to win that argument. In fact, you're probably making things worse than they are right now for society as a whole.

Try this instead:

Do you care about poor people? I mean you actually care about their well-being? Then you don't want them to be dependent on the Government. You want to further the system that has brought the most people out of poverty than any other economic system tried to this date in history.

Call it "free-market," call it "Capitalism," call it what you want. What's the best way to describe it?

Throughout human history the best thing for Human progress has been allowing them to freely trade with one another. That's literally what Capitalism is. I will provide something that you deem valuable, so you will provide me with something I deem valuable- but no one at the top is going to be sitting there deciding if they are going to allow us to do it, and then taking a piece of the pie without our permission. That's the difference between Capitalism and any other system.

Take back the moral high-ground. It's the truth. Go tell it!