Building an Economy that Works for Everyone

Weighing in on Washington’s Minimum Wage

Gary Crooks writes in the Spokesman-Review:

“The best argument against Washington state’s minimum wage is that it is the highest in the country. That’s not to say that it is historically high when adjusted for inflation, because it isn’t. But being No. 1 in that category can turn off businesses that might otherwise move here. It can cause them to think that we’re anti-business in general.

“That’s why it would be better if the rate were the same in each state. But because the federal rate is so ridiculously low, some states have stepped in. The federal minimum wage hit its peak purchasing power in 1968, when it was $1.60 an hour. If it had kept pace with inflation, it would be $9.49 an hour today. Instead, it is $5.85 on the federal level (and in Idaho) and $8.07 in Washington. That’s less than I made as a 14-year-old.”

It would be a good thing if every state had a minimum wage as high as Washington’s. And it’s ironic that a high minimum wage gets tagged as “anti-business”, because it looks like it’s been quite good for Washington’s economy.

Today a full-time worker earning minimum wage in Washington earns about $16,000 annually – that $4,000 more than workers in states with the federal minimum wage. Those added wages are plowed right back into the local economy. At the same time, annual cost of living adjustments provide employers with predictability. Employers know well in advance the amount of the modest annual increases, rather than facing occasional big jumps that result from a partisan political process.

Not only are Washington’s low-wage workers doing well with our strong minimum wage, but so is our state economy. Over the last year, jobs in Washington increased more than three times faster than in the nation as a whole. Jobs rose in both retail and restaurants, the two largest employers of minimum wage workers.

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