Today Washington’s legal minimum wage goes up another notch, as it has on every Jan. 1 for eight years. The new rate is up 38 cents, to $7.98 an hour, making it the highest minimum wage in the nation – at least for a while. Oregon or Alaska usually catches up.
Naturally, this doesn’t sit well with Washington’s small-business community. Carolyn Logue, state director for the National Federation of Independent Business, issued a grumpy press release, contending that increasing the minimum wage hurts low-skilled workers.
"We know for a fact that the vast majority of minimum-wage earners are kids starting out on their first jobs. It should more appropriately be called an entry-level wage, not a minimum wage. The minority of people earning the minimum wage, but not starting out on their first jobs, tend to be the less skilled. When the minimum-wage rises, they are the most adversely affected, since small-business owners must then cut back on hiring, promoting, and over-time.
"The Vedder-Gallaway study done on Washington’s minimum-wage law showed severe job losses among low-skilled workers when the rate rises. The vast majority of employees in Washington earn more, often much more, than the minimum wage. Measure 688 doesn’t affect them. Who it does directly impact are the low-skilled and the entry-level workers who are not the beneficiaries of this well-meaning law, but the victims of its unintended consequences. The Legislature needs to shed some light on this issue."
Last week we editorialized in favor of increasing the federal minimum wage, now $5.15, to $7.25 – a move both President Bush and congressional Democrats now support. But backin 1998, we opposed Initiative 688, which passed and enacted an automatic annual cost-of-living adjustment in the state’s minimum wage. We argued that doing it automatically was a bad idea, especially when the adjustment is based on an urban Consumer Price Index that overstates inflation in living costs.
More recently, we favored legislation that would suspend the annual minimum-wage increase during economic recessions, but those bills went nowhere in Olympia.