Testimony submitted in support of House Bill 1764 and Senate Bill 5578 to the Washington House Labor & Workplace Standards Committee and Senate Labor & Commerce Committee.
Chair Liz Berry, Ranking Member Suzanne Schmidt, Chair Rebecca Saldaña, Ranking Member Curtis King and members of the committee,
Thank you for the opportunity to speak with you today. My name is Sebastian Martinez Hickey, I am an economic analyst at the Economic Policy Institute (EPI). EPI is a nonprofit, nonpartisan think tank created in 1986 to include the needs of low- and middle-income workers in economic policy discussions. EPI conducts research and analysis on the economic status of working America, proposes public policies that protect and improve the economic conditions of low- and middle-income workers, and assesses policies with respect to how well they further those goals.
I am testifying in support of HB 1764/ SB 5578, which will gradually increase the minimum wage to $25 per hour by 2031, establish minimum standards for vacation leave, provide bereavement leave, and bolster wage enforcement. Increasing the minimum wage will raise earnings for more than a million Washington workers. For years, Washington has been a national leader in minimum wage policy. It has the highest state minimum wage in the nation and the city with the highest minimum wage. It is also the first state to index its minimum wage to inflation, a commonsense approach that has been adopted by 20 other states and Washington, D.C.1 But despite these steps, Washington’s minimum wage still doesn’t provide enough economic security for hundreds of thousands of low-wage workers and their families.
EPI’s Family Budget Calculator (FBC) measures the income individuals and families of different sizes need to attain a modest yet adequate standard of living for every county and metro area in the country.2 Workers living throughout Washington state face high costs to cover basic needs such as housing, health care, and food. There are eight counties, encompassing 69% of the state’s population, where a single adult must cover more than $52,000 a year to make ends meet, two of which (Snohomish and King counties) require annual expenses of upwards of $68,000.3
From these budget costs we can estimate a living wage standard that would allow families to make ends meet. One conservative approach would be to calculate an hourly wage that covers the basic needs of a single adult, while also assuming that around one-fifth of their expenses will be covered by income other than wages.4 This “other income” could include employer-provided health insurance, or government social insurance and benefits, for instance. Even under these conservative assumptions, an adequate living wage in King County would come out to around $27.41 an hour today.
Several municipalities in Washington have increased their minimum wage above the state level.5 HB 1764 would likely supersede some of these city minimum wages by 2031, including in Seattle. It is still important for lawmakers to periodically reassess the adequacy of the local minimum wages and higher levels might still be appropriate for expensive regions in the state.
Increasing the state wage floor will be particularly beneficial for families with children. Households with children face significantly higher living costs due to child care and increased food and health care needs. In Spokane County, a two-adult, two-child household must cover more than $107,307 a year to make ends meet, which comes out to $25.79 an hour if both adults are working full time, and all income comes from wages. Families of this size face similar or greater costs across much of the state including in Douglas ($26.45 per hour), Kittitas ($25.85), and Benton ($25.36) counties.6
Our analysis of the proposed legislation finds that by the end of 2031, HB1764/SB 5578 would lift wages for more than a million Washingtonian workers, or 31% of the wage-earning workforce in the state. In total, workers would gain more than $3 billion in additional wages.7 For a full-time, year-round worker affected by the increases, this translates to $2,860 a year in higher earnings.
Our analysis also shows the equity impacts of this proposal. Almost 60% of the affected workers are women. The increase also disproportionately affects Black, Hispanic, and multiracial and American Indian and Alaska Native workers. More than 311,000 parents will get a raise, and 564,500 children live in households affected by the proposed increase.
These wage increases for low-wage workers will not come at the expense of high unemployment or other negative economic shocks. The majority of and highest-quality minimum wage studies find little to no employment loss from minimum wage increases.8 These findings are consistent even at the highest minimum wage levels that have been studied. Most recently, a study of the recent $20 fast food minimum wage in California showed that the policy increased wages for workers, but did not lead to decreased unemployment or business closure in the industry.9
Minimum wage increases avoid significant economic costs because businesses are able to adjust to the increase in labor costs.10 Most low-wage jobs have extremely high turnover rates, but when workers are paid more, they tend to stay at their current jobs longer. This cuts down on the time workers spend between jobs without getting paid and means businesses are spending less money on recruitment and training. Workers also might become more productive, both because of working in the same role longer and because of valuing their job more.
Employers also react to minimum wage increases by passing some of their cost increases on to consumers although research shows that the resulting price increases tend to be very small.11 Workers also move from less productive firms to more productive ones that are hiring after the increases.
In addition to strengthening the wage floor, HB 1764 / SB 5578 would make further steps to create a fairer economy by establishing a 15-day minimum for vacation accumulation and 5 days of bereavement leave. One in four U.S. workers have no access to vacation and the level of access varies greatly by wage level.12 Workers in the bottom 10th of the wage distribution are half as likely as the top 10% to receive vacation days.
Finally, this bill would further empower regulators to treat wage theft in proportion to the impact it has on workers, especially those earning lower wages. The bill enables regulators to issue stop-work orders to businesses found in violation of wage regulations. In 2023, Washington recovered $5.5 million in wages from employer violations, but this is likely only a small share of total infractions.13 Stronger enforcement is needed so that Washington workers are fully paid the wages they are owed.
HB 1764 / SB 5578 is a key step towards creating an economy where all workers in Washington can achieve a decent standard of living and have access to benefits and strong workplace protections. Collectively these policies will contribute to a stronger and more resilient state economy.
Notes
1. Economic Policy Institute, Minimum Wage Tracker. Last updated January 1, 2025.
2. Economic Policy Institute, Family Budget Calculator. Last updated January 15, 2025.
3. The eight counties are King, Snohomish, Clark, Kitsap, Pierce, Whatcom, Thurston, and San Juan counties. Population data from United States Census Bureau, Annual Estimates of the Resident Population: April 1, 2020 to July 1, 2023, Population Division, May 2024.
4. Elise Gould, Zane Mokhiber, and Katherine DeCourcy, What Constitutes a Living Wage? A Guide to Using EPI’s Family Budget Calculator, Economic Policy Institute, January 2024.
5. Bellingham, Burien, King County, Renton, Seattle, SeaTac, Tacoma, and Tukwila. EPI Minimum Wage Tracker, 2025.
6. In Ferry County (the lowest-cost county in the state according to the FBC) a single adult with one child must cover more than $65,100 a year to make ends meet. For a two-adult, two-children household where both adults work full time, the living wage is $22.71.
7. David Cooper, Zane Mokhiber, and Ben Zipperer, Minimum Wage Simulation Model technical methodology, Economic Policy Institute, February 2019.
8. Arindrajit Dube and Ben Zipperer, “Own-Wage Elasticity: Quantifying the Impact of Minimum Wages on Employment,” National Bureau of Economic Research Working Paper no. 32925, September 2024.
9. Michael Reich and Denis Sosinskiy, “Sectoral Wage-Setting in California,” Institute for Research on Labor and Employment Working Paper no. 104-24, September 2024.
10. Ben Zipperer, “Turnover, Prices, and Reallocation: Why Minimum Wages Raise the Incomes of Low-Wage Workers.” Journal of Law and Political Economy 3, no. 1 (2022): 160–171.
11. Ben Zipperer, “Turnover, Prices, and Reallocation: Why Minimum Wages Raise the Incomes of Low-Wage Workers.” Journal of Law and Political Economy 3, no. 1 (2022): 160–171.
12. Elise Gould, “Millions of Working People Don’t Get Paid Time Off for Holidays or Vacation,” Economic Policy Institute, September 2015.
13. Margaret Poydock and Jiayi Zhang, More than $1.5 billion in stolen wages recovered for workers between 2021 and 2023, Economic Policy Institute, December 2024.