The Seattle Office of Labor Standards announced this week that the city’s minimum wage will surpass $22 next year, marking the latest in a long line of steep wage hikes in the Emerald City. With restaurants already feeling the effects of the city’s rising costs, many are bracing for the impact of yet another increase.
Seattle was the first major city to adopt a “Fight for $15” wage over a decade ago. Since the law was implemented in 2015, the city’s minimum wage has climbed more than 130%, from $9.47 to $22.14 in 2027.
The negative consequences of Seattle’s previous wage hikes have been clearly documented. A University of Washington study examining the city’s minimum wage increases found that Seattle’s minimum wage has reduced employment and hours for local workers, while failing to reduce overall earnings gaps. Another University of Wisconsin-Madison study found that following Seattle’s minimum wage announcement, fewer new hospitality and retail establishments opened within city limits, while surrounding areas with lower wage floors saw an increase in business openings.
A recent survey of small business owners found that the majority of respondents say they are worse off financially now than during the pandemic. More than seven in ten (71%) reported seeing fewer customers, while 63% said sales are down, with many reporting revenue declines of 20% or more.
Many small business owners and industry leaders are voicing their concerns about the state’s minimum wage increases:
- “Without a dynamic change, the state is on track to lose about 9% of its restaurants.” – WA Hospitality Association CEO
- “This is financially not going to make sense anymore…the increase would cost me $32,000 more a year.” – Corina Luckenbach, owner of Bebop Waffle Shop
- “As an owner, I want to keep the customer happy and provide a product at an affordable price. We’re about maxed out…Burgers went from $16 to $23.” – David Baus, owner of Magnolia Village Pub
- “At some point, you have to go to counter service…You can’t raise the price of a barbecue sandwich to $30. No one will buy that.” – Jack Timmons, owner of Jack’s BBQ and Jackalope
The consequences of Seattle’s steep wage hikes have caused other Washington cities to approach similar proposals with caution. Earlier this year, voters in Olympia rejected a proposal to raise the city’s minimum wage to $20 an hour, with many business owners voicing similar concerns as those in Seattle.
As the Emerald City prepares for yet another increase, its struggling restaurants will be left navigating higher labor costs on top of already mounting financial pressures.