In November, voters in SeaTac approved a $15 minimum wage for airport-related work and now activists are taking that fight to Seattle. Seattle Times guest columnists debate the merits and downsides of raising the minimum wage.
A neighborhood business can’t support a $15 minimum wage
Gabriel Campanario / The Seattle Times
AT the risk of alienating my friends and employees, I’d like to weigh in against the rush to pass a $15 minimum-wage law.
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City leadership appears to favor it. Seattle Mayor Ed Murray and City Councilmember Kshama Sawant are already duking it out over which of them will lead the charge to raise wages. If either of them had ever run a small business, it’s hard to believe they would support such a large and sudden increase.
No disrespect intended, but I don’t think soldiers who have never served at the front can understand what it’s like to be fired upon. For many of Seattle’s small businesses, it’s a battle just to stay alive.
Some argue the new law wouldn’t affect businesses with fewer than 50 employees because those businesses would be exempt. But, if Fred Meyer, Home Depot and Starbucks are all paying $15 an hour, other businesses would be forced to follow suit if they want to compete for competent, capable employees.
Many jobs in Seattle today don’t start at the state minimum wage of $9.32. It’s more like $10 or $11. A wage jump from $9.32 to $15 would represent a 61 percent increase for entry-level employees.
To be fair, wages for all employees would have to increase by a commensurate amount. My business partner and I calculated that our margin would have to increase by 7 percentage points to cover the additional expense. That means the thingumajig you can now buy at our stores for $19.99 could cost $24.99 in the near future, which would also include higher payroll costs. Seattle’s double tall lattes would cost more than $5, like they do in many places in Europe.
For the past 10 years, storefront retailers have been squeezed by unfair competition from Internet businesses and an unjust tax burden. While Congress dodges the issue of implementing a comprehensive sales tax on Internet sales, we continue to pay sales tax, property tax, business-and-occupation (B & O) tax and personal property taxes on machinery and equipment.
Commercial rents, like residential rents, are going up. Utilities are too. The cost of our employee health-care plan went up 40 percent this year. While Seattle businesses would be struggling to pay rising occupation costs plus $15 an hour to entry-level employees, other states would still have a minimum wage of $7.75.
Suddenly, moving jobs to South Dakota begins to look pretty good.
It’s not that I don’t believe workers deserve $15 an hour. I believe Seattle would be a better place when everyone is making a living wage and has access to affordable health care, sick leave and paid time off.
But I also believe it’s time big corporations, like Boeing and Amazon.com, and wealthy individuals in this state shoulder a larger percentage of the taxes currently borne by small businesses and low- to middle-income people.
If Councilmember Sawant, the City Council and the mayor really want to help the working poor, they should implement rent control.
Sales on Cyber Monday jumped by 20 percent this year. Holiday sales at our stores remained flat.
If we have to increase prices by 20 percent to 30 percent to cover higher payroll costs, people would simply turn to the Internet to buy what they need. The result would kill jobs and further erode our local tax base.
Big retailers like Pottery Barn, Fred Meyer, Target and Home Depot would figure out ways to raise prices or simply invest in more self-serve checkstands. But your favorite neighborhood retail store, where an actual cashier or owner knows you by name, might soon be a thing of the past.
Judith Gille is the founder and co-owner of City People’s Mercantile and Garden Store in Seattle and the author of “The View from Casa Chepitos: A Journey Beyond the Border.”
Raise wages to reduce racial income inequality
VERY Tuesday, hundreds ascend the steps of what once housed a neighborhood church. Today, Columbia City’s Southside Commons provides a different form of sanctuary to the black men who gather there.
As president of the Seattle King-County NAACP, I attend these Career Bridge sessions each week to keep abreast of what’s happening in the African-American community.
Within five minutes of speaking to the men, it’s easy to spot the core of their sorrows. Some are college-educated and some are high-school dropouts; some are ex-felons and some are ministers; many are husbands, even more are fathers.
Yet, despite their many differences, all connect on one common issue: All are suffocating under the constraints of poverty.
African Americans throughout Washington state are suffering under the dual systems of oppression — racism and income inequality.
The recently released report, “America’s Changing Economy: Searching for work that pays in the new low wage job market,” by the Alliance for a Just Society looks at the past five decades. It shows that the March on Washington for Freedom and Jobs, which gave birth to the civil rights movement 50 years ago, remains unmet in bringing financial relief to African Americans living in poverty. Stagnant wages are not commensurate with worker productivity.
What is a living wage? The Alliance report defines it as the wage needed to meet the basic costs of housing, food, day care and other expenses. In Washington state, a living wage ranges from $16.04 per hour for a single individual to $19.89 per adult for a family of four with both parents working.
Competition for living-wage jobs is stiff — there are eight job-seekers for every opening paying a living wage for an individual; expect 22 job-seekers for every living-wage job opening that supports a family of four.
Contrary to the primary purpose of the March on Washington, employment opportunities that usher the working poor out of poverty do not exist. Up to 80 percent of job openings fail to pay a living wage. We must do better.
Today, the national average weekly salary is $292.51. Earnings, adjusted for inflation, are worse than what they were 50 years ago.
We know of the disparate unemployment rates for blacks, but what is often overlooked is the high number of blacks stuck in low-wage jobs. Two years into the recovery, the number of minimum-wage workers across the country increased by 17 percent for blacks, as compared with 5 percent for whites.
The NAACP recommends implementing public policies to establish a minimum wage, living wage and industry wage laws like SeaTac’s $15-per-hour minimum wage for some businesses.
We want to establish community-benefit agreements with local-hire mandates like those supported by our partners at Got Green. The NAACP wants government to provide real oversight by requiring businesses to return government subsidies if promises about job creation are not kept, as seen in our current demands against retaining Seattle Tunnel Partners on the Alaskan Way Viaduct construction project.
The Seattle King-County NAACP wants jobs that provide dignity to its African-American workforce. Seattle needs real solutions. The black men piling into the Southside Commons looking for relief each week deserve better.
Gerald Hankerson is president of the Seattle King-County NAACP.
College graduates need the minimum wage to rise
Recent college grads are uniquely affected by minimum-wage laws. In addition to facing massive student debt and uncertain job prospects following school, recent grads are hit hard by Seattle’s rising cost of living.
It’s trying for recent grads who are unemployed and underemployed, holding jobs that typically do not require a bachelor’s degree. The story of post-grad underemployment is hardly new or novel, but it is getting worse.
A 2014 study by the New York Federal Bank reveals 44 percent of recent college grads ages 22 to 27 are underemployed, compared to the steady 33 percent rate over the past two decades. The quality of such jobs has also declined, with many college graduates holding low-wage and part-time jobs.
I’ve held both, simultaneously. Last year, after graduating from the University of Washington with a bachelor’s degree, I worked two part-time jobs, one at an ice cream shop and the other at a clothing store.
At the outset, it seemed like a tolerable, and even easygoing, summer, allowing me spare time to apply for full-time positions. But the reality of living independently off two low-paying service jobs was exasperating, complicated by with carpal tunnel syndrome, declined debit cards and anxiety attack after anxiety attack.
In the meantime, I applied for full-time jobs, part-time jobs and internships. I had already completed five unpaid internships before finishing school. While automatically generated rejection letters flooded my inbox, I did receive potential opportunities at two highly regarded companies in Seattle: a six-month full-time unpaid internship (with the promise of future employment) at a media company and a full-time retail position with a starting wage of $12 per hour.
My economic situation prevented me from taking either, as making it to the next step in a career is difficult when you’re also trying to make it to the next day.
I ended up moving to New York because the career prospects in my field are stronger. I’m now working a part-time unpaid internship and a part-time retail job to stay afloat as I continue to pursue a paid journalism position. I don’t know how much longer I can stay in New York chasing my passion, living on food stamps and convincing myself it’s all eventually going to pay off.
Economic mobilization requires time and money. Many recent college grads holding customer-service jobs struggle for both under Washington’s current minimum wage of $9.32 per hour.
Without capital, recent grads have limited ability to make crucial, critical decisions for their futures. Low wages inhibit entrepreneurship. They discourage career changes and limit relocation options for nonlocal career opportunities. Low wages also make it costly to pursue additional real-world experience through unpaid internships, which are unfortunately increasingly the norm today.
Seattle Mayor Ed Murray’s executive order to raise wages for all city employees to $15 per hour is a step in the right direction, but it’s not enough. Councilmember Kshama Sawant’s grass roots campaign for $15 per hour for all workers to receive a living wage is a long awaited sign of hope.
The $9.32-per-hour minimum wage does little for recent grads hoping to work and live in Seattle. It’s not enough money for a person juggling a 40-hour week between two part-time jobs in the service industry to make it. It’s not even enough for a person who qualifies for public assistance. It’s especially not enough for recent graduates treading rough post-recession waters.
Sandi Halimuddin is an editorial assistant at World Policy Journal in New York and a former intern at The Seattle Times. On Twitter @sandihalimuddin