Show-Me Minute - Seattle minimum wage

It seems like a good idea. Raise the minimum wage so low paid workers will make more money.

Their standard of living will rise, and the overall economy will benefit. But, sorry, the market doesn’t work that way, and now there is proof.

A few years ago, the city of Seattle decided to raise its minimum wage from $9.47 an hour to $13 an hour at the start of 2016, one of the highest in the country.

Good, right? No. A study by the University of Washington found that small businesses trying to contain costs cut the hours of low wage workers by about 10 percent.

The wage hike also lowered the annual total payroll for low wage workers in Seattle by $100 million dollars.

That’s a drop in income of about $125 per month for the average low wage worker. So instead of helping, the hike in minimum wage actually hurt the very people it was supposed to help.

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Broadcast on:

17 Jul 2017