People rally in support of a $15 minimum wage at Seattle Central Community College in Seattle, Washington March 15, 2014.
Jason Redmond/Reuters

Seattle’s minimum-wage experiment offers encouaraging results

Updated
When Seattle raised its minimum wage to $15 an hour, the right predicted an economic disaster for the city. The predictions were entirely in line with what Republican policymakers say anytime the subject comes up anywhere: raising the cost of labor will lead employers to hire fewer workers, which has the effect of pushing unemployment higher.

Bloomberg View’s Barry Ritholtz published a piece this week taking a look at how those predictions are holding up in Seattle’s case study.
As one of my colleagues wrote last week, 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%.” Meanwhile, a University of Washington study on the minimum wage law found little or no evidence of job losses or business closings.

Although you can never declare a game over until the final whistle, this experiment is starting to look like a rout.
In June 2014, local officials approved the $15 minimum wage, to be phased in over several years, and at the time, the city’s unemployment rate was 5.4%. The law first took effect in April 2015, when Seattle’s unemployment rate was 4.3%. As of last month, after the wage hike, the city’s unemployment rate was down to 3.4%.

There are a couple of relevant caveats to keep in mind. For one thing, Seattle’s minimum wage has gone up each of the last two years, but it’s not yet at $15 an hour. Depending on the size of the business, it’s currently between $10.50 and $13 – well above the federal floor, but not yet at its destination. For another, local economies can vary quite a bit for all sorts of reasons, and Seattle’s successes may or may not be easily duplicated elsewhere.

But in this experiment, the right’s predictions were plainly wrong. The question then becomes what conservatives will learn from this case study.

The short answer is, almost certainly nothing. The prospect of an increase in the federal minimum wage disappeared when Americans elected a far-right Congress to work with a far-right president, who wants a far-right Labor Secretary who opposes any changes to the current minimum.

In Ohio, meanwhile, the Republican-led state government is moving forward with plans to block any city within the state from raising its own local minimum wage, regardless of the cities’ wishes.



Minimum Wage, Seattle and Washington

Seattle's minimum-wage experiment offers encouaraging results

Updated