If anybody doubts that raising the Minimum Wage is good for the overall economy including the job market they should look at my home state of Washington as a test case for what happens when you raise the Minimum Wage substantially.
Highest Minimum-Wage State Washington Beats U.S. Job Growth
By Victoria Stilwell, Peter Robison and William Selway
When Washington residents voted in 1998 to raise the state’s minimum wage and link it to the cost of living, opponents warned the measure would be a job-killer. The prediction hasn’t been borne out.
In the 15 years that followed, the state’s minimum wage climbed to $9.32 -- the highest in the country. Meanwhile job growth continued at an average 0.8 percent annual pace, 0.3 percentage point above the national rate. Payrolls at Washington’s restaurants and bars, portrayed as particularly vulnerable to higher wage costs, expanded by 21 percent. Poverty has trailed the U.S. level for at least seven years.
So raising the minimum wage spurs job growth by stimulating consumer spending by putting more money in consumers' pockets. That results in a reduction of poverty.
Why won't this McDonald's move 20 feet into lower-wage Idaho?
By JESSICA ROBINSON
But in 2010, a group of researchers decided to put that conventional wisdom to the test. And they used counties along the Washington-Idaho border—and hundreds others like them—to do it.
The county that surrounds Coeur d'Alene, for example, has an economy much more closely tied to Spokane’s than to Boise’s. But the state laws governing wages stop at the state line. Bill Lester of the University of North Carolina-Chapel Hill was on the team that looked at 16 years worth of restaurant employment data for 316 pairs of border counties.
“And when you add up all those comparisons and look at the average of all those differences in employment, the difference is zero,” said Lester.
Or, to put it another way: When the minimum wage increases, said Lester,“On aggregate, there's no job losses.”
Claiming that a higher minimum wage reduces employment is a Red Herring. Claiming a higher Minimum Wage is a job killer is only a self serving rationalization made by groups like the N.R.A. (National Restaurant Association).
By TIMOTHY EGAN
Nearly a decade ago, when voters in Washington approved a measure that would give the state’s lowest-paid workers a raise nearly every year, many business leaders predicted that small towns on this side of the state line would suffer.
But instead of shriveling up, small-business owners in Washington say they have prospered far beyond their expectations. In fact, as a significant increase in the national minimum wage heads toward law, businesses here at the dividing line between two economies — a real-life laboratory for the debate — have found that raising prices to compensate for higher wages does not necessarily lead to losses in jobs and profits.
Idaho teenagers cross the state line to work in fast-food restaurants in Washington, where the minimum wage is 54 percent higher. That has forced businesses in Idaho to raise their wages to compete.
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The experience we've had with having a relatively high minimum wage here in Washington makes it abundantly clear that raising the Minimum Wage doesn't hurt employment. It helps our economy.