UNIVERSITY OF WASHINGTON'S REPORT ON SEATTLE'S MINIMUM WAGE HIKE IS IN ... IT'S A MIXED BAG

The University of Washington just released a study reporting on the impact of Seattle increasing it's minimum wage to $11.00 an hour. It's titled "Report on the Impact of Seattle's Minimum Wage Ordinance on Wages, Workers, Jobs, and Establishments Through 2015".

Here's the money quote from page 4 ...      

----- We do not find compelling evidence that the minimum wage has caused significant increases in business failure rates. Moreover, if there has been any increases in business closings caused by the Minimum Wage Ordinance, it has been more than offset by an increase in business openings.  

In sum, Seattle's experience shows that the City's low-wage workers did relatively well after the minimum wage increased, but largely because of the strong regional economy. Seattle's low wage workers would have experienced almost equally positive trends if the minimum wage had not increased. Although the minimum wage clearly increased wages for this group, offsetting effects on low-wage worker hours and employment muted the impact on labor earnings. 

In a few words, it's a mixed bag. The impact of the minimum wage increase was generally positive, but no absolute correlation has been established in the 18 months since the ordinance passed (June 2014; fully phased in April 1, 2015). Still, it should quiet those prone to carping about doomsday scenarios if the minimum wage is raised.

Don't expect the cautionary tone of the report to stop those on both sides of the minimum wage argument from making their case about the good/bad effects of raising the minimum wage. As usual, with issues like this, more time is needed.

- Mark