Seattle Voted to Hike the Minimum Wage to $15 an Hour. Here’s What Happened ...


#1

Seattle Voted to Hike the Minimum Wage to $15 an Hour. Here’s What Happened to Seattle’s Job Market.
Leah Jessen
dailysignal.com
October 22, 2015

Data shows that the Seattle Metropolitan Statistical Area (MSA) lost 700 restaurant jobs from January to September of this year, and a report from the American Enterprise Institute suggests that this could be the product of adverse effects of minimum wage hikes on restaurant jobs.

“What is also noteworthy about the loss of Seattle restaurant jobs this year is the fact that restaurant employment in the rest of Washington state is booming this year,” writes Mark Perry, an AEI scholar and professor of economics and finance at the University of Michigan’s Flint campus.

A report by Perry, published Wednesday on AEI’s public policy blog Carpe Diem, notes that there has been an increase of 5,800 new restaurant job positions in the rest of the state of Washington.

While the overall job growth rate this year for the Seattle MSA is higher than the national average, the drop in restaurant jobs stands out. The past three years have seen restaurant employment in the Seattle MSA area at an average job gain of almost 4,000 employees during January-September, according to Perry’s work.

“One likely cause of the stagnation and decline of Seattle area restaurant jobs this year is the increase in the city’s minimum wage,” Perry wrote.

Restaurant owners acted to compensate for a government-mandated 10%-20% labor cost increase? Who could have forseen that? Does anyone believe the coming ~36% additional labor cost increase will be any les harmful to Seattle’s labor market. I’m guessing the data for restaurant closures and openings for the several years prior to, through, and a couple of years beyond these government-mandated additional labor cost increases might prove interesting as well.


#2

I wonder how many of those new restaurant jobs outside of Seattle are right outside Seattle…


#3

Fairly likely, unless a neighboring city is similarly loony. I know NV has been a haven for businesses fleeing CA.


#4

So $15 an hour is the minimum PLUS they keep their tips?

In Ontario, the minimum wage is $11.25, but I believe the only exempt industry is the restaurant industry in which waitresses and waiters can be paid a lesser min. because it is assumed they will receive tips, which presumably will bring them above the min. wage threshold. I am not sure I respect our system especially when even tipping is becoming difficult for many people. Restaurants still go out of business at a high rate.


#5

I waitressed (many years ago). I made less than minimum wage, but with my tips, I doubled/tripled minimum wage. (depending on shift and day of week).

According to those reality TV restaurant shows, the failure rate in restaurants is extremely high.


#6

Yes indeed, the failure rate is very high. So high in fact that at a major bank I worked at in Canada we were barred from lending to restaurants without major collateral. Basically if the owner had a home we could put a second mortgage on etc.

The truth about most waitressing jobs is that you can literally make as much money as someone in a much higher wage bracket, but it depends primarily on the clientele. An upscale restaurant offering $75 plates and $150 bottles of wine or where businesses bring their partners and associates will most likely see a great deal more in tips than someone working at a glorified fast food joint that sells $3 burgers and cheap combos. No disrespect to that food intended as I certainly don’t dine at an upscale restaurant.


#7

A lot of upscale restaurants now add a 15%+ surcharge for the tip. I worked at a family chain restaurant where the food is a lot cheaper. The traffic is inconsistent. Mon and Tues were slower. But they usually gave the wait staff a larger section. Tips depend a lot on how busy your are, how big your station in and how quickly you can turn your tables over. I wasn’t crazy about the coffee clatchers that came in to talk, not order food and waste your time filling up their cups, while sitting taking up the table forever.

I met a cocktail waitress that worked up the street from where I did. She made more tips in a day than I could in a week.


#8

A former internet friend of mine said when she was working as a waitress (quite years before this was mentioned, and I believe it was mentioned in 2002), she made over $600 a week in tips. At the time she told this, I was making something over $600 a week as a computer programmer, with at least 20 years experience.


#9

In California our Liberals (who care so much about the poor) tax the gratuity, the tax is based on the receipt amounts of the tables that each waitress worked and the assumed “tip” that the customer left; so if a table stiffs the waitress she still has to pay tax on a tip she never received.

Because of course, Liberals are evil monsters who hate the poor.

Just one more argument for why taxing income as opposed to consumption is immoral.