Friday, April 7, 2017

Seattle's $15 Minimum Wage: The Results Are In

Well, it's official.  Seattle's most recent unemployment rate dropped to 3.5% or even as low as 2.9%, depending on whose data you are looking at.  Either way, that is about as full employment as one can practically get, essentially at or close to the level of the 1980s "Massachusetts Miracle" during which the labor market was extremely tight and workers had a lot of bargaining power as a result.

And this drop occurred during the phase-in of the $15/hour minimum wage in the Rainy City, which is currently at $13.00-13.50 (and $15 already for large employers that don't pay health benefits) as of January 1, 2017 and has been at least $11 since April 1, 2015.  Not only is unemployment now lower than the national average of 4.7%, but it generally dropped faster than the national average as well. While correlation is not causation, of course, it certainly does put the lie to the naysayers' claim that it would be a job-killing disaster.  Thus, any putative negative effects on employment were clearly either small, short-lived, or (most likely) nonexistent.

As for automation of fast-food restaurants, guess what?  That is going to happen regardless of the minimum wage, just like it already has in so many factories, gas stations, etc. in the past few decades.  It's inevitable.  And outsourcing/offshoring is practically impossible for most remaining minimum wage jobs.  So we certainly shouldn't let that deter us from Fighting for $15.  Call their bluff!

The True Spirit of America Party currently advocates a national minimum wage of $15/hour, indexed to inflation, phased in within a year or two for businesses with 500+ employees, and within two to three years for smaller businesses.  And with no tip credit. After that, the only exceptions should be 1) small, non-chain businesses with 10 employees or less, 2) workers under 18, for whom it would be on an age-based sliding scale from 60%-90% of the normal rate, and 3) circus performers.  That latter one is so we can (with tongue firmly in cheek) say that any hypothetical people who are priced out of the job market for an extended period can go join the circus, the employer of last resort.  Of course, we also advocate implementing a Job Guarantee program (similar to the one that already exists for senior citizens) as well as a Universal Basic Income Guarantee as well, so regardless of anything the labor market would be fairly tight regardless, and workers would have far more bargaining power going forward, much to the chagrin of the rentier class.

What better time than now?


  1. For some metropolitan areas, such as in the Washington Metropolitan area, $15 per hour is still not a high enough minimum wage. In this metropolitan area, the minimum wage should be $19. The minimum wage in this country should be determined by where a person lives because different areas of the country have a higher cost of living. Otherwise, the benefit of a higher minimum wage are significantly eroded.

    Seattle is proof that a higher minimum wage doesn't reduce job creation. People should support candidates who support high minimum wages because the myths about a good minimum wage are not true. There should be a Universal Basic Income as well for people in this country. I support that people who are 16 or older should be included in any minimum wage increase. 18 is too high for a minimum age for a minimum wage guarantee. Girls and boys shouldn't be thrown under the bus by progressives. Otherwise, those progressives would be ageist bigots who I would work against.

  2. Indeed, $15 is pretty tame, and in many areas still not enough, though a good start. Some places need to be higher, but nowhere should be lower. In fact, if the federal minimum wage had kept up with productivity gains since 1968, it would actually be $22 today.

    As for workers under 18, keep mind that Australia and a few other countries do the same thing, only they set the full age at 21 or even higher, which is patently absurd as the age of majority is 18 there as well. So what I am advocating is more progressive than what they have as far as 18-20 year olds are concerned. I get that a setting it a bit lower (say 10-20% lower, but still higher than the current minimum) for 16 and 17 year olds would make it somewhat easier for them to find jobs in the first place, and make it more likely to pass. Or phase it in more gradually for those under 18. But beyond that, there is really no good reason to deny equal pay for equal work.

  3. I should also clarify that, due to labor laws as currently written, the compliance costs of hiring workers under 18 is greater than for workers over 18, and most 16-17 year olds are still in school and can only work limited hours. Combined with relative lack of experience, they are thus more likely to get passed over in favor of slightly older workers, unless they can be hired for somewhat cheaper.

    Currently, federal law (but only some states) actually allows a lower minimum wage for workers under 20 for the first 90 days on the job. That is wrong as it encourages temporary/seasonal jobs at the expense of permanent ones (despite being disguised as a "training wage"), and it also arbitrarily treats 18-19 year olds as not "real adults". I would not be against your idea of setting the full age at 16, but is certainly should not be higher than 18. And if there is a "training wage" period, it should be no more than 30 days, be no lower than 80% of the full wage. and should apply to all ages equally.

  4. Agreed, the movement to increase the minimum wage should not throw young people under the bus. I have heard members of that movement dismissing young people as people who don't deserve a higher minimum wage. I have heard statistics that are meant to be ageist against young people. I support a higher minimum wage but I will not work with ageists in any capacity.

  5. Indeed, the ageists seem to use "kettle logic" with mutually-contradictory arguments. They believe that 1) "teenagers" (their catch-all term for anyone under 21 or even 25) are undeserving of a higher minimum wage, 2) raising the minimum wage will price them out of the job market, while simultaneously 3) luring them into the workforce and encouraging them to drop out of school or forego college, leading to an increase in "idle teens", particularly among people of color, and 4) only benefitting college students and middle to upper class suburban white high school students at the expense of everyone else, despite that 5) "everyone else" is apparently "undeserving", and 6) young people will somehow take jobs from older adults who need the jobs more than they do. Or something. Yes, these are the ageists' actual arguments when they use young people as a political football. And my ideas in the above blog post are designed to "call the bluff" on the ageists on both sides of the political spectrum.