Highest Minimum-Wage State Washington Beats U.S. in Job Creation

Discussion in 'Politics, Religion, Social Issues' started by rdowns, Mar 5, 2014.

  1. rdowns macrumors Penryn

    rdowns

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    #1
    I thought raising the minimum wage would cost jobs.



    http://www.bloomberg.com/news/2014-...t-minimum-wage-state-beats-u-s-with-jobs.html
     
  2. rhett7660 macrumors G4

    rhett7660

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  3. citizenzen macrumors 65816

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    #3
    Well, that could account for one of the 15 years.
     
  4. rhett7660 macrumors G4

    rhett7660

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    #4
    That is probably the year, the highest levels in the food industry!!
     
  5. Eraserhead macrumors G4

    Eraserhead

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    #5
    I didn't think it was actually legal yet ;).
     
  6. applesith macrumors 68030

    applesith

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    #6
    Yes, there is a correlation, but how do we know there is causation as well?

    On a national level, 60% of employed people are paid hourly, and less than 5% of those hourly paid workers make minimum wage or less. Considering minimum wage makes up a very small percentage of the workforce, I don't see how raising it would have such an impact.

    I haven't looked for Washington's breakdown, but do they have a significantly larger percentage of people working at minimum wage than the country does at a whole?

    Is there info on what jobs increased in Washington?
     
  7. PracticalMac macrumors 68030

    PracticalMac

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    #7
    I guess those waiters now have enough money to go eat out more. :D
     
  8. ElectronGuru macrumors 65816

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  9. Technarchy macrumors 603

    Technarchy

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    #9
    How does Washington compare to other states when it comes to job creation over the same time frame?
     
  10. sviato macrumors 68020

    sviato

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    #10
    Higher wages, lower tip expectations right?? :D
     
  11. samiwas, Mar 5, 2014
    Last edited: Mar 5, 2014

    samiwas macrumors 65816

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    #11
    According to this link (pdf), Washington is currently pretty average in terms of unemployment, and their job creation rate seems to beat the US average. It's odd, though…the graph states that job losses are higher than the US average, but in the text below, their unemployment rate drops faster than the US average. it should also be noted that they have a much higher median household income, a much lower poverty rate, and more people on health insurance.

    Forbes also states a higher-than-average job growth.

    The Bureau of Labor Statistics says that Washington's highest unemployment rate was in 1982, and their lowest was in 2007.

    And this is Washington's employment graph:
    [​IMG]

    Employment did slow, and even drop a few years later, but the rest of the country was pretty much following suit. Then, they picked up and employment climbed pretty steadily until the recession.

    So, it would indeed appear that the higher minimum wage has not had any real adverse effects. But, that seems impossible.
     
  12. vipergts2207 macrumors 65816

    vipergts2207

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    #12
    You're not considering the people who make a little over minimum wage, which is a lot more than 5%. Even though they aren't paid the minimum, they'll still be affected by an increase. Let's say the lowest position at a business pays the minimum and the next position up pays 20 cents more an hour. If the minimum wage goes up 20 cents, the wages of both employees likely go up, otherwise the lowest employee has no incentive to move up the ladder. Even employees that would already be above the new minimum wage would likely receive an increase due to the previously stated reason of employers needing to maintain a sufficiently stratified pay scale. How far up the pay scale a minimum wage increase has an impact likely depends upon the size of the wage increase.
     
  13. applesith macrumors 68030

    applesith

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    #13
    I'm not so sure a minimum wage increase will bump up everyone's wage as a ripple effect. That's going to vary by business.

    Either way, I still do not see any evidence that the minimum wage increase in WA directly increased employment overall. Increasing price does not usually lead to an increase in supply.
     
  14. samiwas macrumors 65816

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    #14
    As another poster said, this isn't just about the "5% who make minimum wage", which is a stat the apologists love to use. There are tons os positions out there which pay no more than a dollar over minimum wage. That's still a terrible wage, but it doesn't factor into the minimum wage discussions.

    So what percentage of workers make $7.50 an hour? $7.75? $8.00? That's really not much better, but you don't hear those numbers. Just "5%!!"

    So what impact would raising the minimum have? Well, what kind of impact are you looking for? My wife finally quit her $8 an hour job that she liked having, because it cost her more to work than to stay at home (after paying for child care). And that was for a pottery studio assistant, so something I would consider above "burger flipper". But, that's what's paid these days. She could have kept working there if they paid anything remotely useful.

    I've also showed before what a drastic affect a large raise could have on Wal-mart workers (and other companies), and the pretty small price increase that would result. What affect do you think it would have if millions of workers in the US were making 50% more in wages, but their expenses rose only 5-8%?

    Well, obviously not "everyone" is going to see a wage increase due to a minimums wage increase. I would not expect my wage to raise at all, as I'm already well-compensated for what I do. I would think if the minimum was raised from $7.25 to $9.00, the ripple might end around $17 or so.

    I don't think that was anyone's point. I think the point was that increasing the minimum wage didn't kill jobs, as is pounded upon us in every discussion on the subject.
     
  15. Eraserhead macrumors G4

    Eraserhead

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    #15
    It will increase the wages of those who earn slightly above the minimum wage however.

    Except that raising the minimum wage also increases demand as the poor have more to spend.
     
  16. rdowns thread starter macrumors Penryn

    rdowns

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    #16
    Raising the minimum wage would also reduce spending on SNAP benefits.

    http://www.washingtonpost.com/busin...0e4bfa-a3db-11e3-a5fa-55f0c77bf39c_story.html
     
  17. Technarchy, Mar 7, 2014
    Last edited: Mar 7, 2014

    Technarchy macrumors 603

    Technarchy

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    #17
    Something about comparing the state to the national average just seems off.

    In 2013 Washington wasnt even top 10 for Biggest Rate of Job Growth according to the Bureau of Labor Statistics, and their unemployment is sitting at 7%.
     
  18. Tomorrow macrumors 604

    Tomorrow

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    #18
    Do we know which is the cause and which is the effect? Or if there's even a causal link?

    Is job creation up because minimum wage is higher, or is minimum wage higher because job creation is up? Or is it just a coincidence?
     
  19. Eraserhead macrumors G4

    Eraserhead

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    #19
    It could be coincidence but job creation can't be increasing the minimum wage IMO.
     
  20. Tomorrow macrumors 604

    Tomorrow

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    #20
    No, but the factors that drive job creation (a thriving economy, for example) would also help drive up wages.
     
  21. Sydde macrumors 68020

    Sydde

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    #21
    Minimum wage is statutory, it is not affected by the economy, except for its yearly COLA.
     
  22. tgara macrumors 6502a

    tgara

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    #22
    Would it?

    The minimum wage acts as a barrier to employment for first-time job seekers and less skilled people. Raising the minimum wage will cause job losses and prevent people (especially those at the low end) from being able to get jobs. Wouldn't that increase the number (and spending) on SNAP benefits?
     
  23. samiwas macrumors 65816

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    #23
    Isn't that the whole point of this thread? And wasn't it shown above that the raising of the minimum wage didn't affect jobs in Washington the way you describe?
     
  24. tgara macrumors 6502a

    tgara

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    #24
    No one should be confident that they can predict the minimum wage statute’s effect without detailed knowledge of what the rest of the economy is doing. At least in Washington state, there are other factors at work (overall called "productivity") that pushed overall wages higher, so that an increase in the minimum wage could be absorbed. The Fortune 500, aircraft, finance, and tech companies in the Seattle area have been growing, attracting top talent and increasing wages at the higher end, and that brings a lot of other industries along too, such as the suppliers, restaurants, hotels, etc., where there are more workers at the lower end. To paraphrase Pres. Kennedy, a rising tide for the big players is enough to lift many, many boats.
     
  25. VulchR macrumors 68020

    VulchR

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    #25
    And without those boats the big players sink. It's about time everybody realises this, including the big players.
     

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