- When SeaTac, WA, passed a $15 an hour minimum wage, hotel construction in the area continued to boom, despite critics saying the wage hike would destroy jobs and keep businesses away, reports The New York Times. SeaTac was the first U.S. city to pass a $15 an hour minimum wage back in 2013.
- Developers told the Times that they chose SeaTac as a construction site because of its open land and proximity to the Seattle-Tacoma International Airport. They were confident that the location would bring in travelers and businesspeople, and that the minimum wage would attract quality job candidates and not be financially burdensome.
- Josh Bivens, research director at the Economic Policy Institute, told the Times that low-wage earners who receive pay increases stimulate the economy by purchasing goods and services with their additional income.
States and municipalities across the country passed minimum wage hikes in the 2016 elections, but not without pushback from the business committee and GOP lawmakers. A study by economists at the University of Washington says that minimum wage hikes hurt low wage earners over time — but the veracity of that study was earlier called into question. Either way, SeaTac provides a case study.
Employers that see business opportunities in similar locations and are able to compete might be less likely to balk at paying their workers $15 or more an hour. If no single business can undercut the other, it seems minimum wage may have less impact on business operations than first assumed.
Better wages are a key aspect of lowering turnover — and turnover in the hospitality industry is always a looming threat. Some companies in lower-wage areas are also shifting to better communication tools and more relevant benefits to encourage engagement and improve retention.