When I got my first job back in 19mumblemumble, I earned the minimum wage of $3.35/hour. The world was a very different place. In my teen years, if you wanted to make a phone call when you were away from home, you had to drop a coin into a (usually filthy) public pay phone and maybe even put your finger into the correctly numbered hole in the dial and turn it clockwise as far as it would go. Do you digital kids even know what “clockwise” means? All this newfangled stuff. Get off my lawn!
The current minimum wage in my state is $9.32/hour, which is significantly higher than it is in many parts of the country. But not high enough. Recently, the People in Charge (PICs) of Seattle voted to raise the minimum to $15.00/hour inside the city limits.
Wow, right? Even for a pinko like me, that seems like a mighty big jump. And establishing a wage structure for a single city is bizarre.
It make sense for Seattle to have a different wage structure than, say, Walla Walla, because the cost of living here is so much higher. But it does not make sense for Seattle to have a higher minimum than the pricey, Microsoftian suburbs to the east. But there it is.
My 17-year-old works about 20 hours per week for minimum wage at the local movie megaplex, inside Seattle. When the PICs started bandying this idea around, I worried that it might cause her to lose her job, because who is going to pay a teen 15 bucks an hour? But you know, the megaplex actually needs all the teens it has. Someone has to stand there and take tickets and tell you where to find your theater. Someone has to shovel the popcorn into the bags. And, Americans being a slovenly bunch, someone has to swoop into the theater after y’all leave and sweep your popcorn off the floor. So they can’t go firing their teens, because the corporate suits do not want to do those tasks, do they?
Generally speaking, in this economy, businesses are not carrying a bunch of extra employees. All the extras got downsized back in 2008 and they have not been hired back. And businesses that use part-time, minimum wage workers are quite adept at ensuring that the costs of business fluctuation are borne by the workers, not the company. If no new films opened that weekend and business is slow, the managers will cut my kid’s shift (and paycheck) short.
In fact, businesses are so good at holding labor costs way, way down that profits are at an all-time record high. Should a business that is bloated with cash pay their workers so little that they need food stamps to get through the month? (Not all minimum wage workers are teens with parents who feed them. And certainly most of the people earning somewhere between 9.32 and 15 are adults trying to get by, and all of those people will get a wage bump, too.) Why should the taxpayers subsidize the sweatshops?
Will smaller business and nonprofits suffer? Probably. The new wage is being phased in on some timetable I haven’t investigated, but seems certain to hurt organizations that operate on the edge.
It’s an economic experiment that will be watched closely. Will Seattle be crushed under the weight of the untenable wage requirements? Or will it turn out that Henry Ford was right, and paying your workers enough that they can afford to buy your products results in more sales? Creating a gigantic underclass, as we’ve been doing since Ronald Reagan turned the clock back on the New Deal, has not been beneficial. A robust economy runs on middle class buying power.