How To Make Sense Of Competing Seattle Minimum Wage Studies

Jun 27, 2017

Two recent studies on Seattle's $15 minimum wage law seem to conflict in their preliminary analyses of the effects of the law.

A study of Seattle's restaurant industry from the University of California, Berkeley, released last week shows that jobs haven't been cut as a result of the increased wages. But a University of Washington study published Monday indicates that low-wage workers across the city may be losing hours since the law was enacted. 

The issue is being closely watched by economists and policy makers who want to know if the wage increase can help alleviate some of the problems faced by low-wage workers. Critics of Seattle's law say it will negatively impact the business climate, ultimately making it worse for those workers.

But the answer to how a $15 minimum wage affects Seattle's economy isn't easy or quick to find, according to Joseph Phillips, dean of the Albers School of Business and Economics at Seattle University.

"You're very early in the game in terms of deciding how the minimum wage law is impacting the city," Phillips said.

First, Seattle's wage law hasn't been completely rolled out yet. 

The City Council approved the ordinance in 2014. The city's larger businesses only had to start paying the full $15-per-hour this year. Although, raises have happened across the board.

"A lot of the research on the minimum wage law in the past was built around very modest changes in the minimum wage and how it might have impacted the workforce," Phillips said. "In this case, these are huge changes."

The other thing to keep in mind is that these studies are sharing preliminary findings, Phillips said. Over the course of the next few years, other economists will discuss and vet these studies' results and methodologies.

"We'll get a much better idea of where the profession lands with this issue," Phillips said.