Priorities and Minimum Wage Increase

Seattle, San Francisco, and Los Angeles have all made steps to increase minimum wage. Now Tacoma seems be following suit as well and the community is in a buzz. On October 8th, I joined fellow Sound Economics writer Jesse Kreutzer and University of Puget Sound professor Andrew Monaco on a trip to Pacific Lutheran University for a public debate about the recent addition to the 2015 November ballot in Tacoma. The debate contained both sides of the argument, #PLU15NOW and #PLUNO15. The side in favor was research analyst, Vince Kueter and PLU senior debater Angie Tinker. Both were speaking in favor of the new initiative, City of Tacoma Citizens’ Initiative Measure No. 1, which would raise the minimum wage to $15 in the City of Tacoma. The measure adds a new chapter to the Tacoma Municipal Code entitled “Tacoma Minimum Wage Ordinance.” This new ordinance would establish the new minimum wage immediately following its enactment.

Many residents of Tacoma have been hesitant to make this new initiative into law. The fact that minimum wage would increase immensely in such a short amount of time has created opposition to the measure. Representatives from this side also attended the PLU debate. The opposition was the president of the Tacoma-Pierce County Chamber of Commerce, Tom Pierson and PLU junior Matt Aust. Pierson represents the part of Tacoma that is worried about the state of Tacoma’s economy after a $5.53 increase in minimum wage. Even the Tacoma City Council saw the need for some sort of alternative. Soon after Initiative No. 1 was certified to be put on the 2015 ballot, the Tacoma City Council voted to put an alternative measure on the ballot as well. This alternative, Initiative 1B, was constructed to increase minimum wage each year to until it hit $12 per hour at the beginning of January 2018. The opposition advocated for this alternative measure arguing that it was a way to ease Tacoma’s economy and business owners into a higher minimum wage. Both sides of the debate produced strong points and observations, but when it came down to it priority was the theme of the discussion.

Advocates for Initiative No. 1 expressed a desire for immediate protection of minimum wage workers, who include students and food service workers. The problem, as stated by Kueter, is wages are not being kept current with today’s economy. Economists have noticed a trend of constant inflation within most First World economies such as the US. There may be fluctuation within this overall trend, but it tends to level out. This means that prices and the cost of living will continue to increase as time passes. Those in favor for minimum wage increase usually look to this trend as the reason to enact measures like Tacoma’s $15 per hour increase. This initiative is watching out for the minimum wage workers. Kueter brought up work related stress causing health issues, while Tinker turned to descriptive stories of struggling low wage workers. It became obvious that their argument was primary focused on the workers, which makes sense. For the supporters of 15 Now Tacoma group, the low paid employees at Taco Time are who they are trying to protect. Minimum wage employees are the priority for them.

On the other side, the opposition to Initiative 1 is trying to protect business owners. They made the argument that businesses would be “shocked” by this sudden increase in minimum wage, especially small businesses. Pierson felt that a minimum wage increase was necessary, but that Initiative 1 was too rash. He thought that small businesses would feel the brunt of this change and that it would hurt Tacoma’s economy. Stores and shops would feel the pressure to raise prices or simply move outside of Tacoma. The argument expressed by Pierson was one centered around protection of business owners.

Once again, the question of priority is raised. It is clear that the opposition’s argument reflects the notion that small businesses should hold more priority than workers. It becomes evident that debate over minimum wage increase revolves around the question of who we should protect: minimum wage workers or business owners. Or another way to look at it is which group in Tacoma’s economy needs support? The employees or employers. Priority shifts and changes over time and between different groups of people. It is not always easy to see which group really needs protection or support more in the short run. But questions to ask oneself is “who has the priority in our society? And who should?”

2 Replies to “Priorities and Minimum Wage Increase”

  1. Hi Cole,
    I don’t wonder if you might be oversimplifying the issue in your last paragraph. Might protecting the business owner employers also protect the employees? I don’t think it is one side or the other that is being chosen/prioritized with the decision to raise minimum wage. I think about how the businesses are better able to stay open, not have to move their location, continue to keep their prices lower if they don’t have to raise the wage as high. Employees might work there because it is closer to their home, in which case a location move (and certainly a business closing) would hurt them. Prices being lower at that business helps business stay at a good level so they can continue to work their shifts and not have shifts cut. Lower prices also help everyone be able to afford the goods, which is especially good if you aren’t getting paid a lot. So if wages go up and prices go up, I wonder if we won’t find ourselves in the same boat after some time. Did the debate, or your research, address some of those questions?

    • I think that is a great point. My last paragraph was more an observation about both sides at the debate. Obviously there are a lot more factors that go into play when debating a big issue like minimum wage. It seemed to me at the debate that both sides were oversimplifying their arguments. When a question was asked to either side, that side would always turn the conversation back to whom ever they were representing. Those in favor to the employees; those in opposition to the small business owners. I think that for most part this notion that if wages increase than so will prices was over looked. It was interesting that the increase in cost of living wasn’t truly discussed at the debate. The only way some businesses would be able to stay would be to increase prices. Thus, I can imagine that most businesses in Tacoma would do this if they had to start paying employees a minimum of $15 per hour. Not only would they have increase the wage of their lowest paid worker, but also their workers who were making $11 or $12 per hour to be able to distinguish promoted workers. So it seems plausible that if Tacoma was to increase minimum wage to $15, that it would become a more expensive place to live and to visit. I was recently in Vancouver BC and discovered how expensive it was. I loved the city but I could not afford to visit very many times. So I think Tacoma could definitely be hurt by a minimum wage that increases the cost of living too high.

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