Economists and partisans across the country have been watching Seattle’s minimum-wage increase looking to confirm their preconceived notions about the policy.
A year ago, researchers from Amazon, New York University, and the University of Washington studied how the wage increases affected 25,000 low-wage workers. This Monday, they released an update.
Quartz reports the study found that some were helped, but many were hurt by the wage increase.
Here’s Who Was Helped
More experienced low-wage earners did receive a slight pay increase. Their hours were decreased, but the higher pay made up for it. So, some people got more pay for less work. Nice for them, but probably not so good for the business.
Here’s Who Was Hurt
Everyone else. Less experienced low-wage workers had their hours cut so much that the higher pay didn’t make up the difference. They ended up with less pay, or the same as before. Further, low-skilled, less-experienced workers found it harder to even find a job in the city.
“The economists also looked at rates of entry, or how many people, who did not work before and have no skills, entered the labor market following the wage increase,” Quartz reported. “The estimate that right after the minimum wage went up, entry rates flattened and eventually fell as the minimum wage went up further, suggesting less experienced workers were offered fewer opportunities for work. Meanwhile, in neighboring counties, entry rates continued to increase before leveling off in 2017.”
The economists then concluded: “Seattle’s minimum wage ordinance appears to have delivered higher pay to experienced workers at the cost of reduced opportunity for the inexperienced.”
Seattle voted for the wage increase in 2014. The minimum wage would increase gradually to $15 an hour over a three-year period. Because the counties around Seattle did not increase their minimum wage, economists got a good look at how such an increase would work in a test city.
But they also cautioned that the results couldn’t be generalized, since Seattle went through an economic boom during this time. One would need to look at a city that increased wages in a city not experiencing an economic boom because from the looks of the Seattle experiment, people trying to enter the workforce and gain experience will be out of luck. If they couldn’t even get jobs during a boom, how could they in normal economic times?
Of course, this study and others like it will likely not deter activists who have been calling for the wage increase. Sen. Bernie Sanders (Socialist-VT) is the most ardent supporter of the increase, and even introduced the “Stop BEZOS Act” to bully Amazon CEO Jeff Bezos into increasing the minimum wage for his employees. It worked, so Sanders turned his attention to McDonald’s and other fast food companies. Sanders’ acolytes, such as Alexandria Ocasio-Cortez, also continue to support the wage increases despite studies and evidence that they harm more than they help.