There’s More Evidence That Restaurant Jobs Go Up When the Minimum Wage Increases

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Again, they're still here.
Again, they're still here.Photo: Spencer Platt

There’s more evidence that higher wages may not in fact lead to the end of days for the hospitality industry. Through November, the Seattle–Tacoma–Bellevue area has seen an uptick in restaurant jobs since April, when an ordinance went into effect in Seattle requiring companies with 500 or more employees to raise the minimum wage to $11 an hour and companies with 500 or fewer employees to raise it to $10 an hour. More hikes will come as Seattle phases in a $15 minimum wage through 2021, while Tacoma will phase in a $12 minimum wage by 2018, with the first hike coming this February. Bellevue has not followed suit, but Washington’s statewide minimum wage is already above the federal standard at $9.47 an hour.

And now, according to figures collected by the Federal Reserve Bank of St. Louis, jobs in the region have increased from 134,500 in March to 136,200 in November. Immediately following the wage hike, there was a drop in restaurant jobs, from 135,300 in January to 133,300 in May, which caused some to go all doom-and-gloom and falsely say it was causing restaurant closures in Seattle. A think tank called American Enterprise Institute pointed to it as proof that a higher minimum wage would have a negative effect on the industry. But those lost jobs have since been gained and then some, with 2,900 added following the May low point, and a total net gain of 900 jobs since January. This is a limited sample, so it’ll have to be seen what happens long-term, and Seattle just hiked wages again on January 1 to $13 for large companies and $12 for smaller companies. Even still, these results seem promising.

[Forbes]