Thursday, January 10, 2013
Washington state’s minimum wage went up 15 cents on New Year’s Day, bringing it to $9.19 an hour — the highest in the nation.
If the economy was roaring, we would have been concerned because an ever-escalating minimum wage can cause ripples as it reduces the number of people employers can afford to hire and it spurs inflation as prices are raised to cover the higher cost of doing business. It also puts businesses in Washington at a competitive disadvantage with the same businesses in other states.
But those concerns are not as relevant in today’s rotten economy. The Great Recession that’s been dragging on for four years has put a lot of people out of work and caused wages to be stagnant or reduced.
The sad fact is many employers in Washington and the other 49 states now pay minimum wage for full-time jobs that require a good education and valued skills. The demand for jobs is much larger than the supply.
Given the state of the national economy, the highest-in-the-nation minimum wage hardly impacts the overall economy of the state but it does result in higher paychecks for those trying to live on a minimum-wage job. Folks dependent on the federal minimum wage, $7.40 an hour, in states such as Idaho often have to look to public assistance to pay for food and shelter.
Yes, even at Washington’s higher pay rate some look to the taxpayers to bridge the income gap. But the gap is much smaller and fewer people need help, which reduces welfare costs.
While we see positives in the state’s higher minimum wage, we still have a concern the mandated pay keeps too many teenagers from getting experience working at a real job. Since employers have to pay $9.19 an hour for teens, some opt to hire fewer teens or use them sparingly.
The law does allow workers who are 15 and 14 to earn a lower wage, 85 percent of the adult minimum wage, but that doesn’t help the older high school student looking to earn some spending money. And it makes it tougher for these kids to build their resume.
Perhaps it’s time for the Legislature to look at tweaking the labor laws for 16- and 17-year-olds. For example, slightly lower wages could be offered for students who work 15 hours or fewer per week.
Having government trying to artificially set wages is tricky — a change to one area causes a new and unanticipated problem in another.
Currently, Washington’s higher minimum wage is doing more good than harm.