In the months since the Seattle City Council voted to raise the minimum wage, predictions have ranged from the extremely negative to the optimistic. The City Council’s vote in June will incrementally raise the minimum wage over several years until it reaches $15 per hour.
Commentators on both sides of the debate came out in force, with opponents citing fears about lost jobs and closures of local small businesses while supporters extolled the virtues of lower-income workers having more cash. While the long-term effects are still not clear, more people and governments are leaning toward raising the minimum wage.
A recent Harris Poll survey of hiring and human resources managers revealed that 62% of those surveyed think that their state minimum wage should be increased. In addition, 55% of respondents believed the minimum wage should be at least $10, although only 7% thought a minimum wage of $15 per hour or more would be fair. However, it’s more than just fast food workers and those in HR who believe a higher minimum wage is good for the economy.
Since Seattle’s vote in June, states like Alaska, Arkansas, Nebraska, and South Dakota—traditionally red states—have votes scheduled for November 4 to raise the minimum wage. It’s unexpected to see states that normally vote Republican moving on a topic that has been pushed more by Democrats, but so far, polls seem to show more voters in favor of these measures than opposed.
But they are not the first to vote. So far in 2014, ten state legislatures along with the District of Columbia have already voted to raise the minimum wage. However, only one of those was a state that voted Republican in the 2012 presidential election. If raising the minimum wage becomes less of a partisan issue, then the effort could pick up more steam in the coming months, especially if results in areas that have already implemented a higher wage show that the minimum wage hike is not hurting the economy.
Minimum wage laws in the United States as of September 1, 2014, courtesy of U.S. Department of Labor.
One such test case is SeaTac, Washington, which approved a $15 minimum wage in November 2013 and implemented the entire increase as of January 1, 2014, with exemptions granted for small or unionized businesses. The Seattle-Tacoma International Airport is also excluded pending resolution of a lawsuit. In the 9 months since the increase has been implemented, no serious issues have been reported, although one restaurant has closed and a few employees have complained about losing some benefits.
SeaTac is mostly an anecdotal case because of its size (only about 1,600 employees were affected), but when Seattle begins ramping up its minimum wage next year, all economic eyes will be watching. Early indicators point to a positive outcome. Renowned Seattle restaurateur Tom Douglas announced five new eateries, despite his own fears that the new wage could force as many as a quarter of the city’s restaurants to close. And Togo’s Sandwiches, a franchise food chain, is planning to expand into Seattle next year as well. Togo’s CEO Tony Gioia claims that he is not concerned about Seattle’s minimum wage law, although it remains to be seen how potential franchise owners will respond.
Expect more analysis as the war of words over wages moves from the hypothetical to the real world in the coming months.
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