Why a higher minimum wage might not help, or hurt, workers

Last year, a study conducted by the University of Washington determined that Seattle’s $15 per hour minimum wage was actually hurting low-wage workers, not helping them. But now, new evidence may suggest otherwise.

RELATED: UW study actually says $15 is too high a wage

The Washington Post reported that recent studies have changed the minds of many economists by finding that minimum wage increases actually don’t do anything.

“Ultimately they say it’s a wash,” KIRO Radio’s Tom Tangney said.

One paper, co-written by Arindrajit Dube of the University of Massachusetts, looked at 137 different wage increases across the country since 1979.

While minimum wage increases do eliminate low-paying jobs, the paper states, they also add jobs that pay at or more than the new minimum. Thus, not a lot changes in terms of the number of available jobs.

Minimum wage outlier

Seattle might be a bit of an outlier when it comes to pay hikes, however. According to The Washington Post, wages in Seattle rose by an average of $3.53, or about 37 percent, in less than a year. The wages that Dube’s paper considered (more than 100) only increased by an average of 10 percent.

“They’re looking at the fact that a lot of these states are increasing 15 cents,” John Curley said. “Can the market absorb 15 cents? Yes. But can the market absorb a 30 percent increase? If it has no effect, let’s pay everybody $50 an hour.”

“It’s taking years to establish,” Tangney retorted. “That’s why they say we’re not going to know about the impact of the Seattle thing for a few years.”

Listen to the full conversation on the Tom and Curley Show here.

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