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How Many Businesses and Jobs Will Leave Seattle When the Minimum Wage Rises to $18.69/hr in January?
That level applies to employers with 500 or more employees. I can see the line of medium-sized businesses preparing to close their doors or move out of the city.
The article also reminds us that on January 1, the state minimum wage rises to $15.74 per hour. No business will be able to afford to hire young people for their first jobs. How many jobs will be automated out of existence?
The Leftists who run the state and the city pride themselves on forcing employers to pay their employees a “living wage,” even for jobs that are simply not designed for people to make a living on. Especially in one of the most expensive cities in the country for housing costs. They have no clue that employers must pass the higher costs on to their customers, who can always go elsewhere to eat or shop.
Published in Economics
People used to know that a fast food job was for kids or maybe a temporary job for an adult. Not every job is supposed to be a living wage job. One has to be very productive for a living wage job in a high cost city.
Either Thomas Sowell or Walter E. Williams used to point out that rises in the minimum wage tended to disproportionately push young black men into unemployment. Young black men statistically have a hard time getting on the first rung of the employment ladder. Statistically they are less familiar with the expectations of employment because they have less association with employed people and in particular have probably not lived with an employed father who would demonstrate work habits, they have a poorer school record, they are more likely to have a criminal record, so they are a high risk hire. Those are all demographic statistical conditions that mean at a high minimum wage fewer young black men will be employed than if the minimum wage were lower (or non-existent). Since “disparate impact” is a legal tool to create a presumption of racism, perhaps it’s fair to conclude that the Seattle City Council is using minimum wage hikes for the racist motive to drive young black men out of the labor force, just as unions did in the early 20th century.
The minimum wage is pernicious and evil. And everybody who is profiting from it in some way knows this.
Besides, as Thomas Sowell so wisely points out, the actual minimum wage is zero, and always will be.
Lots of current minimum wage earners are about to find that out.
Those who support the minimum wage increases are probably the same ones who want to make corporations “pay their fair share”. Wait until the businesses leave for a better business environment.
I see many employers slimming to 499 employees soon. I would be pissed if I lost my $17.00 per hour job because the company had to slim down to 499.
It’s going to get tougher for bigger businesses to attract people to Seattle. Those people will start moving what the City Council probably considers “good” jobs to more affordable parts of the country.
Perhaps You should have worked harder and smarter, then You probably wouldn’t have been one to lose Their job.
Oh wait… Seattle, unions, leftists… scratch that.
Good luck going to Oregon or British Columbia to eat or shop. Are you going to have Scotty beam you there?
Agree, and then my son got his first job this summer at Dairy Queen. They paid $12/hr or about three times what I made at my first job. My oldest got her job last summer making $13/hr at a local Mexican fast food joint. She was making $14/hr after about a year. The Mexican place often had its dining room closed because they lacked the staff to man it, or they ran only one drive through lane.
It’s interesting here in Texas where we are seeing fast food places offering $12-16/hr, and warehouse jobs are $19/hr, and still lots of openings. The local movie house is only paying $10/hr (but 12 free movies a month). Oddly this is with a $7.25/hr minimum wage. Seems to me that the market is working fairly well down here.
Just go to the shops with less than 500 employees.
How many grocery store locations, or coffee shops, etc, can a place operate with under 500 employees? (Presumably that means 500 just in Washington, but who knows?)
Oh, I forgot to mention. Unionized shops are exempt, since they “collectively bargain” wages and working conditions. Guess who were the minimum wage laws’ big supporters in Olympia? Yep, SEIU. Cui bono? SEIU.
And remember, Seattle is the home of Kshama Sawant, the “mother” of the Amazon Tax. It passed, and Amazon rolled over.
I can understand McDonald’s and such as being minimum wage jobs that are not intended by the company to provide a living wage — no one would likely be able to rent an apartment and buy a car on what he makes at an unskilled entry-level position. But on the other hand, I remember when it was first reported that the economy was so bad that women in their fifties and grandmothers were taking jobs there. This doesn’t seem like a rapacious employment practice so much as adults filling a financial need that they couldn’t fill anywhere else.
But even the grandmothers etc weren’t expecting to live off McDonald’s wages. It was a supplement.
I suppose so. It was definitely to pay the bills and make ends meet.
To pay the bills and make ends meet when Social Security etc alone, wasn’t enough. It didn’t have to be a “living wage” on its own.
Exactly.
And it doesn’t have to be a “living wage” for anyone else either, really. Certainly not for teenagers.
This might be no big deal. There likely aren’t all that many employees at corporations earning minimum wage. This will be like a small tax to their operations. Much more costly than the wages would be the costs of benefits and social benefits insurances. If you’re thinking ‘food service’ as an example, those employees will work for contractors, who in turn might employ fewer than 500. If the food service contractor has more than 500 employees itself, that would work to level the playing field against a smaller company competing for the same contract.
I’m thinking the most-affected employers won’t be waiting until the law actually goes into effect, before starting to leave.
We used to know that only cartoon characters could run off a cliff and still be suspended in mid air. But even that is only temporary. Even cartoonists know that. How did we lose basic knowledge about economic “gravity”?
Business expenses vs high corporate tax rates means the business only pays a portion of the cost of increased wage. Large employers don’t outright leave as much as they stop investing in high-cost locations. So it takes time for the damage to catch up with stupid. But fear not, red states send business recruiters to deep blue cities all the time, looking for a score. We may not get the headquarters, but we get most of the expansions.
https://youtu.be/fpCG8TLE6OM=3:18
Agreed. They’ll try to meet the minimum wage requirement, but they’ll either move or go belly-up when they can’t make a profit . . .
I meant that they’re looking at leaving already, as in NOW. Not in January, or February…
I’m reminded of claims (by BY among others) that Biden wasn’t totally responsible for increasing gas prices, since they were already going up before he took office. Yes, in fact they started going up right after Election Day. Because people knew what was coming, Biden told them, and that IS his fault.
That $18.69/hour mentioned in the headline is for Seattle, not all of Washington state. So if Seattle’s neighboring cities just go by the state minimum wage and have lower costs and prices, people may very well drive an extra 15 minutes to save a few bucks. Besides, the mismanagement of traffic in Seattle already provides a powerful disincentive to shop there if you have an alternative.
Ahh, Seattle…
People don’t seem to pay as much attention to actual costs as they should. I remember when the IRS allowance for travel mileage was something like $1 per mile, which included fuel, wear, etc. And that was quite a while ago. But people don’t figure the actual total cost of things nearly enough. They may not even realize that they’re using increasingly-expensive fuel, if the activity of buying gas is sufficiently separated in time from the trips they make. So it could easily be that going to the corner to get a gallon of milk at 7-11 for $6 or $7 is actually cheaper – perhaps MUCH cheaper! – than driving 10 miles to get it at Costco or Sam’s Club for $4 or $5.
In order to promote equity, they will also be instituting a fuel tax to bring the price at the pump to $18.69/gallon. Work 8 hours, buy 8 gallons. Next week I will be busy explaining to angry Seattleites that I was joking.
That they are. It’s clear they know what’s gonna happen, and aren’t sticking around to even try to make it work . . .