Seattle Votes to Increase Its Minimum Wage to $15 | Smart News | Smithsonian

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Seattle Votes to Increase Its Minimum Wage to $15

Economists, however, say that the unprecedented hike could have negative repercussions for the city

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Yesterday, Seattle's city council unanimously approved a hike in minimum wage from $9.32 to $15.00 per hour, CNN reports. Washington State already had the highest minimum wage in the country, CNN continues, compared to the federal minimum wage of $7.25 and the national average of $7.49 (as of 2012). 

If all goes according to plan, Seattle will gradually increase its minimum wage, starting with about a $1 increase next April. Most businesses will be paying at least $15 to employees by 2017, CNN continues, and all will be paying that wage or higher by 2021. The city says this will benefit some 100,000 minimum wage workers. 

As the New York Times points out, Seattle's vote highlights an increasing economic disparity around the nation, with tech and business hubs like San Francisco, San Diego and Chicago casting a rosy outlook on minimum wage, while many cities in the South remain entrenched in a minimum wage of $7.25, with no talk of raising it. 

Economists aren't sure what that means for the country—or for Seattle. On the small scale, it could cause people to leave smaller tips for service industry workers, knowing full well that those employees are being paid $15 an hour, the Times points out. On the larger scale, however, economists and local business workers worry that the hike in pay will cause inflation as the Amazon bubble bursts. (The company's headquarters are based in Seattle.) 

Here's Slate with more on potential repercussions of "one of the most ambitious, and quite possibly misbegotten, labor market experiments in recent memory": 

We know that businesses in high-wage countries are especially eager to replace workers with software. Fast-food restaurants in Europe, for instance, have been some of the earliest adopters of labor saving technologies like digital kiosks where customers can order. Those innovations are already beginning to make headway in the United States. But by passing a $15 minimum, Seattle would risk speeding the process up within its city limits.

Or, Slate points out, some businesses might chose to simply relocate to outside the city's jurisdiction, to avoid the increase in pay. 

 

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