The Seattle increase is written to phase in over a few years making its full impact unclear. A study out of the University of Washington (UW) found Monday that the increase has already had a negative impact on local employment. The Economic Policy Institute (EPI) countered in a separate study that the findings are questionable. (EPI study mentioned throughout)
Inside Sources
June 27, 2017
Seattle’s $13 minimum wage has reduced the hours of low-wage workers by 9.4 percent, according to a study released by University of Washington researchers this morning. The study examined the first two hikes in Seattle’s $15 minimum wage law, from $9.47 to $11 in 2015 and to $13 in 2016. The first round had little effect, the research found. But in the second, hours for low-wage workers fell by 3.5 million per quarter. The reduction in hours, paired with a modest 3 percent increase in wages, had a sizable effect on the amount of money workers take home. According to the study, low-wage workers — defined as earning less than $19 per hour — took an average pay cut of $125 per month in 2016. The findings are likely to inflame the partisan debate over minimum wage. The left-leaning Economic Policy Institute already released a lengthy rebuttal, arguing the analysis “suffers from a number of data and methodological problems” that skew the data toward job loss. The authors warn that their findings shouldn’t be used to frame the national debate over minimum wage. They caution that differences in regional economies could produce different results for minimum wage hikes elsewhere.
Politico
June 27, 2017
Groups supporting a higher minimum wage argue the study is flawed and inaccurate. In general, the University of Washington study finds that a 3% increase in the minimum wage leads to a 1% decline in lower-income employment. But economists at the liberal-leaning Economic Policy Institute say that ratio is so far outside the mainstream findings of other research that it can’t be right. And the study’s authors acknowledge other limitations of their research. Since it relies on data gathered by the state, for instance, it doesn’t reflect what’s going on in the unreported cash economy. And it doesn’t cover contractors, who report wage and employment data differently than what the researchers had access to.
Yahoo Finance
June 27, 2017
The Economic Policy Institute (EPI) immediately took issue with the study’s methodology, and said the report was automatically biased toward finding job losses because of the way it handled data. “The authors’ analysis, however, suffers from a number of data and methodological problems that bias the study in the direction of finding job loss, even where there may have been no job loss at all. One initial indicator of these problems is that the estimated employment losses in the Seattle study lie far outside even those generally suggested by mainstream critics of the minimum wage (see, for example, Neumark and Wascher [2008])—as the authors themselves acknowledge
Seattle Pi
June 27, 2017
“My view of the research is that it seems to work,” Ben Zipperer, of the liberal Economic Policy Institute (EPI) in Washington, tells the Washington Post. “The minimum wage in general seems to do exactly what it’s intended to do, and that’s to raise wages for low-wage workers, with little negative consequence in terms of job loss.”
Minnesota Public Radio
June 27, 2017
“One initial indicator of these problems is that the estimated employment losses in the Seattle study lie far outside even those generally suggested by mainstream critics of the minimum wage,” wrote Ben Zipperer and John Schmitt in an analysis for the liberal Economic Policy Institute.
The Washington Examiner
June 27, 2017
Meanwhile, the left-leaning Economic Policy Institute issued a statement Monday questioning the methodology of the UW research, calling it “fundamentally flawed.” “(The) study … suffers from a number of data and methodological problems that undermine and cast doubt on its conclusions,” the statement says, adding that the UW researchers calculated employment losses “that are well outside the bounds of most published research on the minimum wage (and) contains several notable flaws that cast significant doubt on its findings.”
KOMO
June 27, 2017
The study could overturn decades of conventional wisdom that said the benefits of raising the minimum wage outweigh the costs, the Washington Post reports.
“My view of the research is that [the minimum wage] seems to work,” Ben Zipperer, an economist at pro-minimum wage Economic Policy Institute, told WaPo. “The minimum wage in general seems to do exactly what it’s intended to do, and that’s to raise wages for low-wage workers, with little negative consequence in terms of job loss.”
The Daily Caller
June 27, 2017
His fears are backed up by the liberal-leaning Economic Policy Institute, which projects that more than 81,000 jobs in Ohio could be lost within five years under the AHCA, resulting in a 0.7 percent drop in the state’ overall employment.
NPR
June 27, 2017
The Economic Policy Institute says researchers used limited data and their analysis is biased.
KIRO
June 26, 2017