Washington is becoming the state with the maximum number of minimum wages.
The rate statewide increased by 13 cents to $9.32 an hour on Jan. 1. Pay has been adjusted annually for inflation since voters approved Initiative 688. The result is the nation’s highest minimum wage.
But it’s not Washington’s highest minimum wage. Also on Jan. 1, as many as 1,600 lucky workers in the city of SeaTac started earning $15 an hour because voters there approved a local initiative imposing the new rate. Although intended to take effect citywide, a judge ruled the increase cannot be applied within the fences of Sea-Tac Airport, which is owned by the Port of Seattle, another government entity. That decision has been appealed.
In Seattle itself, new Mayor Ed Murray has already taken steps toward boosting the minimum wage for city workers to $15, which will affect 600 out of an estimated 10,000 employees. The pressure is on to make the rate applicable to businesses as well. Gov. Jay Inslee says he would like to see a pay scale that starts at between $10.82 and $11.82 an hour. House Democrats would take it to $12 by 2017.
And President Obama is talking up his $10.10 plan: simple, and simplistic. But the current federal minimum – $7.25 an hour, which applies in Idaho – all but requires the follow-up: You want food stamps with that?
Republicans in Olympia have responded with countermeasures targeting younger workers. Washington unemployment rates for teenagers and those ages 20-24 years are among the highest in the United States. Washington allows employers to pay 14- and 15-year-olds 85 percent of the adult minimum, or $7.92 an hour. Senate Bill 6495 would extend that option to workers as old as 19, who would get the higher pay between the state and federal rate.
Under Senate Bill 6471, Sen. Michael Baumgartner, R-Spokane, would allow businesses to pay employees 19 and younger the federal minimum wage from June 1 to Aug. 31. And Sen. John Braun, R-Centralia, would stop the wage wars by forbidding any local government entity to set a minimum above the state level. Bravo, Braun.
Employees are migratory, not so businesses. The owner of a hotel in SeaTac will have to absorb the new minimum wage costs there, perhaps by raising room rates, and thus giving competitors just outside of the city an advantage. Future hotels will be built outside the city, or they will be built small enough to qualify for an exemption – if they believe future changes will not lower the minimum room standard.
Owners of restaurants, cleaners and other businesses will make the same calculations and may not choose to invest. There’s a reason some national fast-food chains are under-represented in Washington, if they are represented at all.
Washington’s rebound from the recession has not been robust. The state and local unemployment rates increased in December.
Employers watching the minimum wage free-for-all have plenty of reason to avoid that next hire. Initiative 688 wasn’t much loved by business in 1998, but it was endorsed by two-thirds of Washington voters, and it has provided predictability.
Let it be.