States that enacted minimum-wage hikes last year showed faster wage growth. Here's why Washington wasn't among them.
A report this week from the Economic Policy Institute showed that wages rose for the lowest-paid workers in 17 states and the District of Columbia that enacted minimum-wage increases last year.
In those locales, workers in the 10th percentile saw a wage increase of 5.2 percent from 2015 to 2016. That compares with an average raise of 2.5 percent for the other states. But put Washington in the latter category, even with Seattle stepping up toward its $15 an hour minimum wage.
The report doesn’t get into whether jobs were lost or job growth slowed down in those states.
Also, Washington’s performance is fairly easily explained. The state already had a $9.50 an hour minimum, among the highest in the country until last year. So the benefits for the lowest-wage workers have already accrued. The wage increased to $11 as of January.
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The city of Seattle has about 550,000 jobs of all wages out of a state total of about 3.3 million statewide. Seattle also has a disproportionate share of high-paying jobs. Thus, the Seattle minimum-wage rise likely wouldn’t kick up the statewide data for 2016.
As for lost lower-wage jobs here — which critics of the $15 wage cite as a danger — no evidence has yet emerged. The federal Bureau of Labor Statistics showed that the number of employees in food service and drinking establishments in the Seattle-Tacoma-Bellevue metropolitan area reached a record in January. It’s been steadily rising since the end of the recession. The data don’t break out individual cities. The University of Washington Evans School of Public Policy and Governance is studying Seattle (the most recent report is here, and the sky isn’t falling).
Meanwhile, the broader EPI report, released last week, contains plenty of interesting data. Perhaps the top news is that the wages of average workers finally moved up last year after a long slumber. Lower unemployment will do that.
Today’s Econ Haiku:
One year’s tax returns
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