$15 Minimum Wage? Seattle Says Yes

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President Obama and many congressional Democrats want to raise the federal minimum wage to $10.10 an hour. Seattle has one-upped that effort, enacting a $15-an-hour minimum wage for all Seattle employers.

The increase, approved unanimously by the City Council, will be phased in over the next several years, depending on the size of the company and the benefits the employer provides, according to CNN Money. Large businesses need to comply by 2017. All Seattle businesses must enact the new minimum wage by 2021.

SeattlePI said:

“While this is a bold proposal, it is a moderate proposal: There’s a seven-year phase-in,” Mayor Ed Murray said. The process of compromise brought “huge wins” for business, particularly small business, during implementation, the mayor added.

At $9.32 per hour, Washington state already has the highest state-level minimum wage in the U.S., CNN Money said. The federal minimum wage is $7.25 an hour. But a quarter of Seattle residents earn $15 or less per hour. And nearly 14 percent live below the federal poverty level. It’s estimated that more than 100,000 Seattle workers will benefit from the higher wages.

Labor activists have lauded the decision to hike the minimum wage, while others, like Forbes’ contributor Tim Worstall, have predicted dire consequences. Worstall wrote:

So that’s what we would expect from this rise in the Seattle minimum wage to $15 an hour. Some rise in unemployment. A much larger rise in high school graduate unemployment relative to the general unemployment rate. And a significant reduction in the job-related benefits that workers receive.

Proponents of the hike in wages argue that it will give greater buying power to workers who earn the least.

Of course, it remains to be seen how this hike in wages – which will bring the city’s minimum up to about 59 percent of the current local median wage – will impact Seattle. I think one thing is certain: When people debate the potential implications of raising the minimum wage, all eyes will be on Seattle in the coming years.

What do you think of Seattle enacting a $15 minimum wage? Share your thoughts below or on our Facebook page.

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Comments & discussion

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  • VinayDeanCardwell

    Looks like someone is getting greedy….$15 is a little steep and will increase the cost of living in an already expensive place to live.

  • Summer J.

    I do not think this is best. Employers will not just cough up more money for their employees without finding a way to maintain or increase their profit. To avoid giving certain employees benefits related to Obamacare, my last job cut hours. I read about a story in SeaTac where the minimum wage has already increased, and employees’ benefits were cut. Minimum wage increasing sounds great, but what scares me is what employers will do in response. Not to mention more lay offs, higher unemployment rates, possible higher education requirements for jobs, etc.

  • Joseph Freitas

    I predict the buying power of everyone above the minimum to reduce, and the buying power of everyone currently below to remain the same over an extended period of time. This will destroy the middle class of Seattle because they have no mandate to have their wages increase. It won’t help the poor. If anything the poor will be more poor when the inflation rises and their benefits do not. Additionally, this will drive up the unemployment rate, and force taxes to increase for those still working to pay for drain of the unemployed.
    Basic econ 101 really.

  • Joseph Freitas

    Wow, I didn’t know I got all this stuff because I was blessed, and I sure as hell didn’t know I was supposed to bless others with it. I didn’t get that memo I thought I worked for it and got to do with it what I pleased.
    I guess Obama was right “If I have a business, I didn’t build that”

    • Michael Smiley Gawthrop

      Obama’s quote is so very close to the truth, it only lacks one word to make it a true statement “you didn’t build that alone.” Add the word “alone” and it is a 100% true statement that only the most arrogant or ignorant would disagree with. No business could survive without its customers, couldn’t survive without its suppliers being reliable, couldn’t survive without the infrastructure that allows commerce (electric, phone, internet, the roads your customers use to get to you, etc), and in many cases couldn’t survive without the help of employees. That doesn’t mean that there isn’t one person responsible for bringing all those resources together into a successful business, but they didn’t make it appear out of nothing.
      Up until recently, I was willing to give Obama the benefit of the doubt that this was what he meant… now I’m not so sure.

      • Joseph Freitas

        I agree with you mostly as it relates to customers and suppliers, but I believe government plays more of a hindrance role rather than that of a helping hand.

        • Michael Smiley Gawthrop

          There are a few times when regulations can help an industry… the confidence a consumer has in the FDA seal of approval definitely helps a pharmaceutical company, FAA regulations definitely make travelers more willing to travel by airplane, and on a more localized example, gaming regulations have definitely helped the Nevada casino industry. I point that one out because with most regulations people like to counter “but industries would form their own standards and adhere to them because having an unsafe product would be bad for business.” They are right, but for a consumer, you will never know that they are selling an unsafe product until you or someone you know gets harmed by it… you definitely won’t buy it in the future, but the damage is already done. Casinos however prove the point that there are those that will do whatever they can get away with whether or not it is good for the industry as a whole. Tribal casinos are bent and corrupt beyond belief, there are people who have reported dealers changing the rules of the game midway through a game… their only recourse is to stop going, which they do, and unfortunately do with a bad view of the industry as a whole. Casinos in Nevada however have to follow gaming laws, laws which are readily posted in the casino, laws that any patron can look up, and that any patron who feels they have been wronged can report to the state and have the state act as a mediator and solve the problem. The patron may leave that casino with a bad view of that casino, but will not have nearly as much of a loss of respect for the industry, after all, their problem did get fixed.
          A lot of regulations do just get in the way, but when applied properly and judiciously, they can be used to help support an industry.

          • Joseph Freitas

            Yes, that is true, and if Gov’t regulation disappeared overnight we would have that problem play out in the short term. However, in absence of gov’t agencies you would see what you see in industries with very little regulations.
            Big players, and reputable companies in the industry would band together and form certifying organizations as proof of their best practices. There are hundreds of examples of this. You don’t need the government for that. Everything they do they do on the backs on people and less efficiently than private business.
            I hate to go back to the Obama quote but to me him saying “If you own a business you didn’t build that [alone]” In my mind it is more like “No, I built this alone in spite of the obstacles government put in my way”
            They don’t do things for me for free. I pay them. I would say I drastically over pay them for what I get.

          • Michael Smiley Gawthrop

            You’re absolutely right, absent government regulations, most of the industries would regulate themselves… my point wasn’t so much that all regulations are great and only the government can provide them, but that they need not be a hindrance if done properly. Personally, on the consumer end, I doubt many people care who has established and enforces the standards that an industry follows as long as those standards are there and they protect the consumer.
            Also, if we are talking about where are tax dollars are going, enacting and enforcing regulations is such a small portion to be negligible, our largest expenditures are military, social security, and medicare (with military being the only one that doesn’t have a dedicated tax solely for funding it)… so if you want to complain about dollars not well spent, ask congress why the military needs more tanks than it has tank drivers and more planes than pilots and what the hell is up with the $500 toilet seat.

  • smokey347

    be interesting to see how that works out. i’m guessing not well for seattle. i think they are off my tourist agenda.

    • VinayDeanCardwell

      Yeah me too. I am from the Pac Northwest and I don’t return and visit often because of the cost of everything. It’s pricing itself out of the tourist market.

  • gphx

    ‘The small businesses in Seattle are going to have tax credits allowed to them’. Oh, yay. So now the middle class who make $16 an hour and up can not only pay taxes for the unemployed, they can also pay for the ‘underemployed’ people who make a dollar an hour less than they do.

  • Joseph Freitas

    “however opportunity often time comes disguised as hard work” I like the way you said that

  • Summer J.

    I can promise you that is not the case in regards to “people would already be making $15/hr if they had needed skills.” I personally know how hard it is finding a job with the right skills for the job. SOME jobs pay you the minimum of what they could get by with no matter how much skill you have, and that skilled worker is willing to accept that because of how hard it is to find a job. You’re right, you don’t NEED an education, but if Sally and Joe have the same “skills,” but Sally has her bachelor’s degree, and Joe only has his high school diploma; if Sally is willing to accept the same financial offer as Joe; Sally is hired. I’ve seen it happen.

  • Jim

    Many of the jobs affected are the jobs meant to help kids get through college and earn extra money, not support a family. The burger joints and retail stores we worked in as kids to help pay for the first car, or educational expenses. I predict many businesses will reduce staff and look for automated ways to deliver services – ipods for ordering food, soda machines for dispensing soft drinks.