Be careful what you wish for...

Workers Will Suffer in the Long Run

Diana Furchtgott-Roth

Seattle’s economy can support a raise to $15 an hour, but what about Seattle’s young and low-skilled workers, who might want summer jobs? They will be left twiddling their thumbs on their couches — or those of their parents. And families who want to go out to eat might think twice and then stay home.

Seattle has one of the highest hourly median wages in the nation, according to the Department of Labor. Both the Seattle-Bellevue-Everett area (ranked 13th, with $22.43) and the overlapping Seattle-Tacoma-Bellevue area (ranked 18th, with $21.72) beat the national hourly median wage, $16.87. As a result, the negative effects of a $15 minimum wage will not as bad as they would be in Brownsville-Harlingen, Texas, which has a median hourly wage of $10.81.

But low-skill jobs remaining in the city will see increased competition, with medium-skilled, experienced workers winning out over low-skilled, mainly young workers trying to reach the first rung of the career ladder.

With a $15 minimum wage floor, Seattle will say goodbye to many of its low-skilled workers, most of whom serve the retail and leisure and hospitality sector. They are likely to be gradually replaced by self-order kiosks that use touchscreens instead of cashiers in restaurants, and self-scanning checkout booths in drugstores and supermarkets.

In April, the Restaurant Opportunities Center, a union-funded worker center, organized High Road Restaurant Week in New York City. The average price of a burger and fries at participating restaurants was $20.50. A family of four would pay $82 for burgers, instead of $10 to $15 at McDonald’s.

Last month USA Today reported that Panera is incorporating multiple technologies, such as store kiosks and mobile ordering, to reduce cash registers in stores. Panera will do fine in Seattle. But what about the kids who want summer jobs? Perhaps they will go to Texas for the summer.

Link:
http://www.nytimes.com/roomfordebate/2014/06/04/can-the-minimum-wage-be-too-high/higher-minimum-wage-hurts-low-skill-workers-in-the-long-run