Estimated effects of a D.C. minimum-wage increase to $15 by 2020
| Simulated increases | Nominal increase in minimum wage | Total estimated workers1 | Total private and nonprofit workers | Directly affected2 | Indirectly affected3 | Total affected | Total affected as share of all workers | Total affected as share of private and nonprofit workers | Cumulative increase in total annual wages for directly and indirectly affected4 | Cumulative change in average hourly wage of affected workers | Cumulative change in average annual income of affected workers | |||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Nominal dollars | 2016 dollars | Nominal dollars | 2016 dollars | Nominal dollars | 2016 dollars | |||||||||
| July 1, 2017: $12.50 | $1.00 | 793,000 | 515,000 | 50,000 | 33,000 | 83,000 | 10.5% | 16.1% | $68,567,000 | $67,025,000 | $0.51 | $0.50 | $828 | $809 |
| July 1, 2018: $13.25 | $0.75 | 803,000 | 521,000 | 53,000 | 36,000 | 89,000 | 11.1% | 17.1% | $142,681,000 | $136,337,000 | $0.99 | $0.95 | $1,593 | $1,522 |
| July 1, 2019: $14.00 | $0.75 | 812,000 | 527,000 | 57,000 | 45,000 | 102,000 | 12.6% | 19.4% | $238,725,000 | $222,765,000 | $1.46 | $1.36 | $2,353 | $2,196 |
| July 1, 2020: $15.00 | $1.00 | 821,000 | 533,000 | 70,000 | 44,000 | 114,000 | 13.9% | 21.4% | $361,349,000 | $329,288,000 | $1.96 | $1.78 | $3,177 | $2,895 |
| Total | $3.50 | 821,000 | 533,000 | 70,000 | 44,000 | 114,000 | 13.9% | 21.4% | $361,349,000 | $329,288,000 | ||||
1 Total estimated workers is estimated from the American Community Survey respondents who were 16 years old or older, employed, but not self-employed, and for whom a valid hourly wage can be imputed from annual wage earnings, usual hours worked per week, and weeks worked in the previous year.
2 Directly affected workers will see their wages rise, as the new minimum-wage rate will exceed their current hourly pay.
3 Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage.
4 Total amount of increased annual wages for directly and indirectly affected workers. Values in each step are cumulative of preceding steps.
Note: Assumed annual working-age population growth: 1.15% (2015–2020 annualized population growth rate projections from Metropolitan Washington Council of Governments employment forecast). Assumed annual nominal wage growth of 1.2% leading up to first step (average annual increase in CPI from 2014 to 2017 using actual 2014 and 2015 CPI inflation and CBO's inflation projections). In subsequent steps, wages are assumed to grow at the projected pace of consumer price inflation, per the CBO: 2.3% in 2018, 2.4% in 2019, 2.4% in 2020. Dollar values are adjusted to 2016 dollars using CBO's inflation projections.
Source: EPI analysis of District of Columbia Minimum Wage Amendment Act of 2016 using American Community Survey microdata