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The New York Times reports that new research suggests that the recent minimum wage increases in Seattle did more good than harm - contradicting earlier research by the same group that said something different.

The research group - which included economists from the University of Washington - looked at the fact that “Seattle increased its minimum wage for large employers to $11 an hour, from $9.47, in April 2015, then to $13 for many of those same employers in January 2016. (The minimum wage increased by less for small employers, and for large employers that contributed toward workers’ health coverage.)”

With a little more time and distance, the research group has concluded - this time around - that the increase was good for people in low wage jobs who worked the most hours (more than 600-700 hours in a nine month period), statistically irrelevant for low wage employees who worked less than 600 hours during that period, and damaging to unemployed people who were looking for jobs but had trouble finding them because of an increased minimum wage.

“One interpretation of the findings,” the Times writes, “is that the Seattle minimum-wage increases helped workers who had languished in low-paying jobs for some time - perhaps parents working full time to support a family - while providing fewer benefits, or even causing harm, to workers like college students who seek part-time jobs for discrete periods to earn spending money or help pay for school.”

One of the study’s authors suggests that “the real contribution of the latest paper might be to force policymakers to consider who benefits from a minimum-wage increase and who doesn’t, and whether that allocation of benefits is consistent with what a government is trying to accomplish.”
KC's View:
Seattle may not be the best city in which to evaluate a minimum wage increase, since it is in the middle of an amazing boom these days. (There are a lot of companies paying more, not just because they can, but because they have to.) I also can understand why some businesses resist the idea of some minimum wage increases, especially to $15 … for some, working on narrowing margins because of a wide variety of raised costs, it becomes close to untenable.

But … I always wonder how many of these companies where c-level executives challenge increased minimum wages but have no problem taking enormous salaries and benefits packages. I have no problem with senior executives making a lot of money, but I do question how their concerns about salaries only seem to apply to the people in an organization who make the least. It is one of the reasons that I am such a fan of employee ownership or, at the very least, employee profit sharing programs that make it possible for everybody to share in the wealth and find even greater motivation to be both efficient and effective.