
The UW Study on $15 an Hour Does Not Reflect My Life as a Minimum Wage Worker - aaronbrethorst
http://www.thestranger.com/slog/2017/07/20/25299657/guest-editorial-the-uw-study-on-15-does-not-reflect-my-life-as-a-minimum-wage-worker
======
ineptech
The gist of this editorial is, "That study said that the minimum wage hike led
to businesses laying people off, but that didn't happen where I work at
Domino's, we're hiring." And since she brought it up, it does seem like for
certain businesses, like pizza delivery, the cost of the hike (paying their
employees more money) would be offset by the benefit (Seattle's poor people
having more money to spend on pizza). A business with low-income workers but
no low-income customers, e.g. a company that cleans yachts, would see the
opposite.

And lo and behold, it turns out that one of the main criticisms of this study
is that they excluded most large employers and chains (on the theory that if a
chain restaurant in Seattle hires people or fires people, it's more likely to
be caused by some external effect than by the wage hike). And since OP brought
it up, it does seem like the chains that this study excluded would be likely
to be exactly the sorts of employers who would see more benefit than cost.
That's not evidence that the study is wrong, period, end of story, but it is
intriguing, and I can't find any suggestion on the study's website that they
attempted to account for this.

It's easy and satisfying to dismiss things out of hand for being anecdata, but
sometimes you miss interesting perspectives in so doing.

~~~
moonka
The Weeds podcast by Vox had a recent episode that talked about this and the
study in detail if anyone is interested.
[https://www.vox.com/2017/7/14/15964284/the-weeds-seattle-
min...](https://www.vox.com/2017/7/14/15964284/the-weeds-seattle-minimum-wage-
podcast)

------
cheald
"My single data point disproves a rigorously-conducted study spanning millions
of workers and thousands of employers."

Come _on_.

~~~
mythrwy
[https://evans.uw.edu/sites/default/files/NBER%20Working%20Pa...](https://evans.uw.edu/sites/default/files/NBER%20Working%20Paper.pdf)

While I don't doubt the veracity of some of the conclusions (more cost per
hour means hours get cut) there does seem to be a few what I'd consider
"contortions" to get the desired result. I say "desired result" because
sometimes people who fund these things, yes, even (especially?) at
universities have compelling interest.

For instance, they exclude all "multi-site" businesses from the study (Dominos
for instance so study doesn't even apply to author in the first place). One
has to wonder what the results would have looked like had they not done that.

Not arguing for against state/city minimum wages, don't have an opinion either
way. Just skeptical.

~~~
cheald
The study was commissioned by the city of Seattle after the passage of its MW
ordinance - there is every reason to believe that the "desired result" was
"the MW raise is good and justified and has no net negatives". That's a part
of the reason that the results of this study are so surprising.

The exclusion of multi-site businesses was because of the inability to
distinguish a business's physical location from its account location, which
would have confounded the results:

> The data identify business entities as UI account holders. Firms with
> multiple locations have the option of establishing a separate account for
> each location, or a common account. Geographic identification in the data is
> at the account level. As such, we can uniquely identify business location
> only for single-site firms and those multi-site firms opting for separate
> accounts by location. We therefore exclude multi-site single-account
> businesses from the analysis, referring henceforth to the remaining firms as
> “single-site” businesses.

(This suggests that a locally owned and operated Domino's franchise would be
classed as a single-site business and included in the study, while a non-
franchised Walmart would be classed as a multi-site business and excluded.)

Furthermore, survey evidence suggests that multi-site businesses may be _more_
likely to contribute to the "negative" effects:

> Survey evidence, discussed below, indicates that multi-site employers were
> if anything more likely to report staffing reductions in the wake of the
> minimum wage increase...survey evidence collected in Seattle at the time of
> the first minimum wage increase, and again one year later, increase suggests
> that multi-location firms were in fact more likely to plan and implement
> staff reductions.

Skepticism is good, but let's give the researchers credit here: they've done a
pretty stellar job of mitigating confounding variables and justifying why
they've made the choices they have in which data they chose to study.

~~~
mythrwy
Fair enough.

For the record I'm generally opposed to government induced market distortions
(but understand they may sometimes be necessary). Not for ideological reasons
but because practical reality and unforeseen side effects and the cure being
worse than the disease and all. Municipalities dictating a minimum wage I'd
think to be probably a bad idea.

Still, excluding nearly half the workers in question from a specific segment
leaves the study much less credible than it could be otherwise.

Most Dominos, WalMarts etc. have been honed for labor efficiency for decades.
I suspect they can't cut staff or hours much more while continuing to operate
in which case workers are (temporarily at least until wage pain causes someone
to invent a pizza store machine) better off. Maybe not so much "looser" mom
and pop type businesses who this will cause to tighten up.

A final point is the value of extra time. So workers are $125 less well off at
the end of the month. But they are working many less hours and no matter how
you slice it they are making more money per hour. With more free hours they
can take part time jobs, pursue education or training which increases future
value, save money by doing things like cooking and their own childcare etc.
etc. So the loss of $125 per month is at least partially offset by a certain
amount of value.

------
scotttrinh
I, for one, am divided on issues like this and all of the other social issues
of our time. In my world-view, the cause is the state (don't take that to mean
society, I mean literally the state apparatus) so all of these state-sponsored
fixes amount to mitigation strategies at best, not solutions.

Even having said that, mitigation is better than continued suffering. To
illustrate my point with an extreme example: making it illegal to kill your
slave doesn't solve the underlying slavery issue, but hopefully it would stop
some slaves from getting murdered, in the meantime.

There is an inherent danger in trying to work within the system to fix it, but
we're talking about real people's lives.

I think it's still an open question whether or not raising the minimum wage is
the best way to mitigate the problems of the working poor, but I don't think
the sky will fall if we get it wrong–it's already wrong, amirite?

~~~
anth1988
> In my world-view, the cause is the state

What does this even mean?

> To illustrate my point with an extreme example: making it illegal to kill
> your slave doesn't solve the underlying slavery issue, but hopefully it
> would stop some slaves from getting murdered, in the meantime.

The state outlawed slavery.

~~~
nickthemagicman
I thought the same thing. Private industry made slavery. It took the state to
put an end to those abuses.

And the state is also trying to put an end to wage slavery abuses.

But most rebublicans appear to be ok with getting paid nothing and working
slave hours.

So I'm happy to let them elect conservatives that cut labor laws, and lower
minimum wage.

A nice cheap unregulated labor force in the heartland America will lower my
cost of goods and shipping on the coast.

Republicans are like a voluntary slave force for the liberal coasts.

~~~
scotttrinh
I'm not sure why you think that, but private industry did not make slavery in
America. Large royal charters and monopolies granted by the crown created huge
estates and large tracts of low value farmland that could only become valuable
by the use of slave labor. Sure, it was private individuals who were granted
this favor and given access to cheap forms of labor, but it was not a natural
outgrowth of private industry. At best it was unfortunate side-effect of the
state's benevolence, and at worst, a conspiracy by the state to create wealth
at the expense of an exploited class of people.

At any rate, I think you misunderstand my stance, I'm not looking to cut labor
laws or lower minimum wage. I'm looking to free the worker from the shackles
of the system that the state has created for them. In the meantime, if we're
looking to ease the pain and suffering of those forced to live and die in that
system, I think we should consider it, but think long and hard about how and
if it will actually bring relief, or will it have unforeseen consequences that
will make the situation even worse? That's what we should focus on.

BTW, definitely not a republican, so I think the rest of your comment can be
fairly ignored by me. :)

------
morugin
It's a complex issue but I think one of the main points from the opposition is
that with increased wages will come decreased rates of employment.

I think this point really becomes an issue for people who believe that "if you
work hard, you will get what you deserve (e.g., a middle to high wage)".

For them, the tradeoff is raising the wage is for a lazy worker vs. having a
lazy worker be unemployed.

The point becomes less of an issue if you believe that there are hard working
people making the best of their abilities who can only obtain low wage jobs.

Then it becomes an issue of whether you believe $15 should be the minimum for
someone who works just as hard as you.

------
stephengillie
It's important to keep in mind that Amazon's presence has raised the average
income in the city to over $90k/year. Even making $15/hour, this individual
relies heavily on public assistance.

I didn't read the study so I'm not sure if this outlier was included in the
overall analysis.

------
nxsynonym
Minimum wage raises are great, if basic living expenses don't inflate to match
it.

As the author states, $15 an hour isn't even enough to get her + kids off of
Section 8 and Foodstamps. Minimum wage is supposed to be the minimum to afford
basic living expenses, which clearly it is not.

The fix is not in continually raising the minimum wage. The fix will only come
by putting a cap on rental prices, utilities, and food staples.

Universal income is a better step the right direction, but again it will only
work if there is a cap on how much housing/utilities/food is raised.

~~~
mythrwy
Caps sound like a very good way to get less food, utilities and housing in
general.

Until such a time when the robot overlords are put in charge of distribution
freeing us from the tyranny of inefficient and cruel markets.

~~~
nxsynonym
So just keep inflating wages? Great idea if we want to keep the poor in
poverty and continue living a waste-filled and over consuming lifestyle.

~~~
valuearb
Minimum wage increases dont inflate wages. Most get the raise but some get
laid off.

