Seattle has been gradually increasing its minimum wage, with the city planning to make it $15 by 2021. (It's currently $13 for most businesses.)
While advocates may be thrilled, a new study out of the University of Washington suggests that the rising minimum might actually be harming low-income workers in general. Researchers say that while the new law is indeed resulting in higher wages, employers have reduced hiring and hours, reports the Seattle Times. However, skeptics say the study is flawed and point to a second study out of Berkeley with a different conclusion.
Details:
- A key figure: The study, which has not been peer-reviewed, finds that the hike in the minimum wage so far has cost the average low-wage worker $125 a month. The reason? While pay has gone up 3%, workers saw their hours fall by 9% from 2014 to 2016, say the researchers. They also estimate that without the law, another 5,000 low-wage jobs would exist in the city currently. (The study compared Seattle to surrounding control areas that saw no wage increase, notes the LA Times.)
- 'Very credible': The Washington Post calls the results "bad news for liberals" in its headline and quotes an MIT economics professor who sees the study as "very credible" and predicts it will be influential. It is "sufficiently compelling in its design and statistical power that it can change minds."
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