$15 Minimum Wage in Seattle Working Fine So Far

Brad DeLong points to the latest study of employment in Seattle as it steadily increases its minimum wage to $15 per hour. As usual, what we want to know is not what absolute employment in Seattle looks like, but how it compares to a similar city with a lower minimum wage.

But what is a “similar” city? The obvious candidates are cities just over the border from Seattle. But those aren’t perfect, since they might have different demographics. The latest and greatest technique, then, is to create a “synthetic” city made up of various other places similar to Seattle. If you do this properly, you get a control that tells you how Seattle is doing compared to how it would be doing with a lower minimum wage. Here’s the result for the food service industry, which is a heavy user of minimum wage labor:

As you can see, synthetic Seattle is identical to real Seattle prior to the minimum wage hike. That suggests it’s a pretty accurate composite. After the minimum wage hike, they stay pretty similar. In fact, real Seattle has slightly higher employment. The obvious conclusion is that raising its minimum wage hasn’t depressed employment in Seattle at all. DeLong comments:

Low-end labor markets simply do not appear to work like competitive markets. Rather, they work like markets in which employers have substantial market power—and thus minimum wage laws have the same efficiency benefits as does natural-monopoly rate regulation. Why low-end labor markets do not appear to work like competitive markets is a very interesting—and, I believe, unsolved—question. But it is in all likelihood a fact to deal with.

I’d add an obvious caveat to this: it’s possible that a modestly higher minimum wage has little effect when the economy is doing well. We don’t know yet how employment in Seattle will respond when the economy turns down.

One More Thing

And it's a big one. Mother Jones is launching a new Corruption Project to do deep, time-intensive reporting on the corruption that is both the cause and result of the crisis in our democracy.

The more we thought about how Mother Jones can have the most impact right now, the more we realized that so many stories come down to corruption: People with wealth and power putting their interests first—and often getting away with it.

Our goal is to understand how we got here and how we might get out. We're aiming to create a reporting position dedicated to uncovering corruption, build a team, and let them investigate for a year—publishing our stories in a concerted window: a special issue of our magazine, video and podcast series, and a dedicated online portal so they don't get lost in the daily deluge of headlines and breaking news.

We want to go all in, and we've got seed funding to get started—but we're looking to raise $500,000 in donations this spring so we can go even bigger. You can read about why we think this project is what the moment demands and what we hope to accomplish—and if you like how it sounds, please help us go big with a tax-deductible donation today.

We Recommend

Latest

Sign up for our newsletters

Subscribe and we'll send Mother Jones straight to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate