New Survey of Seattle Businesses: $15 Wage Hike Will Raise Prices, Reduce Job Opportunities, and Shut Doors

  • Publication Date: June 2014

  • Topics: Minimum Wage

Washington, D.C. — Today the Employment Policies Institute (EPI) released a new survey of Seattle businesses gauging how they plan to adapt to the city’s minimum wage increase to $15.00 – the highest in the country. Of those surveyed, nearly 70 percent said that the higher minimum wage would cause a “big increase” in their labor costs. In response, businesses were “very likely” to reduce employee hours, eliminate jobs, or pass the additional cost onto consumers. One in seven were “very likely” to close at least one location.

The full survey results are available here.

The survey was conducted between June 6th and June 9th, and represents the experiences of 265 locations that will be affected by the new law, with a concentration of employers in the retail and service industries. Some highlights include:

• Nearly 90 percent of the businesses surveyed were small businesses with fewer than 50 employees; half of them had fewer than 10 employees;
• 44 percent reported they were “very likely” to scale back employees’ hours;
• 42 percent were “very likely” to reduce the number of employees per shift or staffing levels at their business;
• 43 percent of respondents said it was “very likely” they would limit future expansion in the city of Seattle;
• Roughly one in seven respondents (14 percent) said they were “very likely” to close one or more locations.

“These survey results suggest that proponents of Seattle’s $15 minimum wage hike were being less than truthful when they said a minimum wage hike wouldn’t hurt employers and employees,” said Michael Saltsman, research director at EPI. “Seattle may be the first major city to $15, but it will also be the first to find out why it’s a bad idea.”