Seattle Minimum Wage Study Finds Negative Effects on Low-Wage Workers

Employment Law

A recent major study commissioned by the City of Seattle has shed light on the economic impact of the Fight for $15 movement on low-wage workers, estimating that in Seattle, which passed a measure incrementally raising the city's minimum wage to $15 an hour, the average low-wage worker lost $125 a month.  The study, conducted by University of Washington economists, was able to draw on more detailed data than was available to previous research.  Reflecting these methodological improvements, the study suggested that Seattle's second minimum wage incremental increase, from $11 an hour to $13 an hour, reduced hours worked for low-wage workers by an average of 9 percent while only raising hourly wages by an average of 3 percent.  In another example of a minimum wage effort gone awry, Maine has repealed part of its recently-enacted minimum wage law after an outcry by those it was intended to aid.  The new law had done away with tip credit rule, which mandated that tipped workers could make half of minimum wage.  According to both restaurant workers and management, the law would have driven up labor costs for restaurants while ultimately lowering the wages of tipped workers.  The law had originally passed by referendum.