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With Seattle raising minimum wages in 2016 to $10.50 to $13 (depending on the size and type of business), some analysts predicted jobs would be cut and unemployment would go up. They were wrong: what actually happened is that hiring increased and unemployment fell:
"The unemployment rate in the city of Seattle – the tip of the spear when it comes to minimum wage experiments – has now hit a new cycle low of 3.4%, as the city continues to thrive. I’m not sure what else there is to say at this point. The doomsayers were wrong. The sky has not fallen. The restaurant business, by all accounts, is booming..."
When low wage workers are paid more, they have more money to spend. Local businesses see more traffic, revenue and sales. To meet the demand they hire up.
Red states still stuck at $7.50/hr would be wise to follow Seattle's lead and raise the minimum wage. They will be pleased with the result.
Hell, since it is so great, why stop at $15? Why not make everyone better off and raise it to $50 or even $100?
Anyway, Seattle's unemployment rate is just decreasing along with the national average, it is incorrect to correlate it to the minimum wage increase. Seattle's unemployment was even lower in 2008...
Additionally, someone is an idiot if their measure of wage success/non-success is the unemployment rate...
If the higher wage is so great for businesses, then why are not businesses everywhere doing it then?
With Seattle raising minimum wages in 2016 to $10.50 to $13 (depending on the size and type of business), some analysts predicted jobs would be cut and unemployment would go up. They were wrong: what actually happened is that hiring increased and unemployment fell:
"The unemployment rate in the city of Seattle – the tip of the spear when it comes to minimum wage experiments – has now hit a new cycle low of 3.4%, as the city continues to thrive. I’m not sure what else there is to say at this point. The doomsayers were wrong. The sky has not fallen. The restaurant business, by all accounts, is booming..."
When low wage workers are paid more, they have more money to spend. Local businesses see more traffic, revenue and sales. To meet the demand they hire up.
Red states still stuck at $7.50/hr would be wise to follow Seattle's lead and raise the minimum wage. They will be pleased with the result.
I actually really like Ritholtz and that blog, he is a smart guy, however, I'm not sure a sample size of one city is really an all encompassing victory on this effort, especially not somewhere like Seattle which is incredibly different than many other cities in this country.
Seattle has a pretty high COL, correct? I imagine most places were paying somewhere in this range anyway in order to attract even low skill employees. If a local municipality wants to raise their minimum wage to be commensurate with the prevailing cost of living, sounds good. Seems to be the best way to deal with the minimum wage issue. Federal minimum wage makes no sense, however, because the COL in a small town in Mississippi is going to be vastly different than that of Boston, for example. Why not leave it to local government to make the best decisions for their citizens? Of note, that's actually what most conservatives believe - keep the government as close to the citizen as possible with much less centralized power.
Common sense would suggest that, but there are many people who truly think the COL is basically the same every where in the US, and cannot comprehend that it costs much, much cheaper to live in Chattanooga, TN than in NYC. But yet they will advocate the same minimum wage for both areas.
Common sense would suggest that, but there are many people who truly think the COL is basically the same every where in the US, and cannot comprehend that it costs much, much cheaper to live in Chattanooga, TN than in NYC. But yet they will advocate the same minimum wage for both areas.
Then they're morons. Frankly, there's nothing else one can say about someone who would believe such a thing.
You need to deport all illegals and put tariffs on imports. That's how things worked 30 years ago. Wages will naturally rise. Workers can spend more. That's the middle class.
The ONLY reason business can find workers for $7/hr is because of the millions of illegals here and because third world counties have no environmental regulations, they dont pay 15.3% of wages into social security and corporate taxes are much lower. This isn't an issue of 3rd world countries just having lower wages. It's because they have lower cost overall. They don't make anything better. They are just CHEAP. The money goes to profits, no where else.
The funny thing is, those of the liberal mindset pretend to be the educated ones, but their conclusions don't seem that educated ultimately.
Those charts assume simple elastic demand for labor; but in fact, as experience with minimum wage and employment has shown, the demand is highly inelastic.
With Seattle raising minimum wages in 2016 to $10.50 to $13 (depending on the size and type of business), some analysts predicted jobs would be cut and unemployment would go up. They were wrong: what actually happened is that hiring increased and unemployment fell:
"The unemployment rate in the city of Seattle – the tip of the spear when it comes to minimum wage experiments – has now hit a new cycle low of 3.4%, as the city continues to thrive. I’m not sure what else there is to say at this point. The doomsayers were wrong. The sky has not fallen. The restaurant business, by all accounts, is booming..."
When low wage workers are paid more, they have more money to spend. Local businesses see more traffic, revenue and sales. To meet the demand they hire up.
Red states still stuck at $7.50/hr would be wise to follow Seattle's lead and raise the minimum wage. They will be pleased with the result.
The 'experiment' was always over for the left, they were never going to accept anything except a positive result no matter how they had to cook the statistics.
Seattles economy is doing well because of very high paid tech workers, not because of a higher minimum wage that hasn't been fully implemented yet and isn't being increased evenly across all businesses.
... Federal minimum wage makes no sense, however, because the COL in a small town in Mississippi is going to be vastly different than that of Boston, for example. Why not leave it to local government to make the best decisions for their citizens? Of note, that's actually what most conservatives believe - keep the government as close to the citizen as possible with much less centralized power.
.... except local decisions can have national implications. Low wage flyover states tend to be highly dependent on federal government assistance (states like KY, AL, KS, etc. get more federal aid than taxes they send to DC). If these states make misguided decisions by keeping minimum wage too low, more local residents qualify for federal assistance, costing all US taxpayers more. Personally I think the federal government should threaten to withhold federal aid to any state that has minimum wage below that state's poverty line. No excuse for that.
.... except local decisions can have national implications. Low wage flyover states tend to be highly dependent on federal government assistance (states like KY, AL, KS, etc. get more federal aid than taxes they send to DC). If these states make misguided decisions by keeping minimum wage too low, more local residents qualify for federal assistance, costing all US taxpayers more. Personally I think the federal government should threaten to withhold federal aid to any state that has minimum wage below that state's poverty line. No excuse for that.
How do you know it's due to min wage and not due to low wages above min wage? A lot of people qualify for assistance on an above min wage job. And a lot of people get paid $15/hr for 20 hrs a week, so they qualify for assistance. $15/hr doesn't mean jobs are available to everyone and for 40 hours a week. It only means that some people will get $15/hr for a few hours a month. So you have to make employers hire people full time only and you have to make them hire people until all people who want to work are employed. How do you do that?
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