All the cool states are doing it: Oregon, California and New York have committed to phased-in increases to the minimum wage by 2022. In November, a voter initiative will give Washington the chance to join them.
Initiative 1433 would gradually lift the wage floor over four years to $13.50 and introduce a new statewide paid-sick-leave policy. Unfortunately, it pushes a seemingly arbitrary threshold too fast and too far for many Washington communities to bear.
The first jump would take effect Jan. 1 when the current minimum wage of $9.47 (the seventh-highest state) would increase to $11, followed by $11.50 in 2018, $12 in 2019 and the big final leap to $13.50 in 2020.
Finding the sweet spot between wage gains and job losses not only requires political and economic finesse, it takes time, which is why the four year/four dollar acceleration proves risky.
The initiative is an understandable attempt to address a bleak reality: Though the U.S. can pat itself on the back for an historic economic recovery, it failed to reach millions of middle- and low-income workers.
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The gross domestic product may be doing just fine, but data from the U.S. Census Bureau show many households have not returned to pre-recession levels due in part to painfully slow wage growth.
There’s no question the raise proposed in I-1433 would be meaningful purchasing power for a working single mother, but it could also be crippling for the business that employs her. Bigger cities like Tacoma and Seattle, which already have raised their base wages, can do so with fewer unintended negative consequences than small towns like Tenino and South Prairie.
A reasonable number around which a compromise could be forged is $12, which is what Tacoma voters settled on last year and what Democratic presidential nominee Hillary Clinton (and Washington Sen. Patty Murray) have advocated for a national minimum wage. It’s also not insignificant that the Washington Restaurant Association, a member of the anti-wage-increase bloc, came around last fall and said it could support $12.
Those who want to raise the minimum wage to $13.50 or higher don’t have much solid research to lean on, at least not in Washington — at least not yet.
Consider Seattle, where the city is gradually moving to $15 an hour. According to the first part of a study by the University of Washington, the lowest-paid workers in Seattle saw a modest gain in income, on the order of a few dollars a week, after the city’s first bump to $11 an hour in 2015.
But those benefits were thought to be mostly the result of a thriving metropolitan economy, and were offset by modest decreases in hours and employment.
The five-year study is still developing, but so far the research doesn’t call for a brass-band celebration.
Another argument against I-1433 is that it would deter new businesses from coming to Washington and shift jobs to lower-wage states. Raising the national minimum wage above today’s obsolete $7.25 an hour, an active discussion in this year’s presidential race, would make progress toward a more equitable base floor.
Why do we have a minimum wage at all? Is it meant to be a living wage, a starting wage, a lowball incentive wage to move people away from crummy jobs?
Pundits and politicians will debate these questions ad nauseum, but it’s time to tear up the sepia-toned stereotype of the minimum-wage teenager saving up for his first set of wheels.
One third of Americans work 40 hours or more a week at a minimum-wage job and still live near or below the poverty line. Most of these earners are adults 25 years and older; 60 percent are women, and a vast majority are people of color.
In 1938, President Franklin Roosevelt fought for a minimum wage of 25 cents an hour at a time when the country was coming out of the Depression. The man whom historians credit for saving capitalism said: “No business which depends for existence on paying less than living wages to its workers has any right to continue in this country.”
But no matter how compelling the arguments seem, an accelerated increase like the one proposed in I-1433 is not a panacea.
Twelve dollars an hour is not a magic number, either, but it strikes a reasonable balance.
Some of the best anti-poverty solutions can be found in policies like the earned income tax credit, which allows working people to keep more of what they earn, or low-income housing tax credits, or grants to make higher education more accessible. Our governments should expand these tools and address income inequality in ways that don’t jeopardize employment opportunities for people in the middle and at the bottom.
Ours is an 80-percent service-sector economy; it depends on consumers with spendable incomes. But if employers cut back or go out of business because of an arbitrarily high wage floor, it’s the workers who ultimately will have nothing to stand on.