There are always a few items we’ve read during the week that deserve more attention but don’t make it into our regular posts. So we bundle them for the Friday roundup.
Here’s this week’s bundle:
Bloomberg News (McCardle): Seattle’s costly pursuit of a $15 minimum wage
Particularly be prepared to rethink very high minimum wages, like those supported by the “Fight for $15” folks. For as the authors note, the first round of hikes had relatively small impacts, while the second round had huge ones, suggesting that the effects may be nonlinear. That makes sense. Relatively few people in this country make the minimum wage, so a small increase doesn’t make much difference to most workers, or most employers. But a large jump affects more people, and the wage increases are much bigger for the lowest-paid staffers. If you make $9 an hour, but generate $10.50 in revenue for your boss, a law that raises the wage to $10.45 may cause her to shrug and decide it’s easier to keep you on as long as she’s making something. But a wage that forces her to pay you far more than you bring in? Continuing to employ you would just be bad business…
If the minimum wage increases by a penny an hour, probably even most rock-ribbed conservatives would not predict mass firings. On the other hand, if the wage was arbitrarily set to $100 an hour, even ardent labor activists would presumably expect widespread unemployment to follow. You can’t flat-out say “minimum wages don’t increase unemployment,” because the size of the increase, and the level of the resulting wage, obviously matter at some margin.
Seattle may have discovered that margin. And unfortunately, it may yet discover even further, uglier margins when the data is in on the full increase to $15. That’s the danger of striking out for uncharted territory; sometimes, you end up where there be dragons.
The Lens: Revised School Siting Bill Passes, Inslee’s Support Expected
After several failed attempts and a partial veto from Governor Jay Inslee, the Washington state legislature passed on Friday, June 30 a bill that supporters believe will finally address the land shortage issue many school districts face while looking for new school facility locations. The bill was sent to Inslee on Monday and is expected to be signed.
HB 2243 received overwhelming support in the state House, 78-15, along with a solid 30-19 majority in the Senate. It allows districts to build urban schools in rural areas – outside the county’s urban growth area (UGA) – something that has until now been mostly prohibited by the state Growth Management Act, as well as the Growth Management Hearing Board.
Washington Research Council: The state average wage increased in 2016, which will affect some state programs with benefits tied to it
According to the Employment Security Department, the average annual wage in the state increased to $58,957 in 2016. (The 4.8 percent increase over 2015 is apparently the largest percentage increase since 2007.) The 2016 average weekly wage was $1,133.
Association of Washington Business: Hirst fix remains as big unfinished business; lawmakers need to pass a solution before they go home
Last fall’s Hirst ruling, as well as the similar Foster decision, have essentially cut off development across the state by placing new water rights burdens on property owners and county planning departments. The problem affects not just single-family residences, but also those in the agriculture industry where farm worker housing is a big issue. In many cases, farmers could wind up paying more for a hydrological study, assuming a county would even entertain a permit, than they would on building the housing itself.
With rural homeowners caught in a legal bind over drilling wells, the pressure has been on the Legislature to find a Hirst fix.
New York Times: U.S. Labor Market Roars Back, Adding 220,000 Jobs in June
The labor market roared back in June, with a hefty monthly gain in jobs, and revisions added 47,000 more jobs to April and May than previously reported. Over the past three months, job gains have averaged 194,000 a month. Although the unemployment rate ticked up from the previous month, it did so because more people joined the work force.
Chicago Tribune: Illinois House Overrides Rauner Vetoes of Income Tax Increase, Budget
Seeking to restore stability to a state government teetering on the abyss, lawmakers on Thursday turned aside Republican Gov. Bruce Rauner‘s opposition to a major income tax increase and a spending plan, ending a record-setting impasse.
Illinois had gone 736 days without a budget, and the final seven packed in plenty of statehouse drama. Tempers flared, threats were issued, alliances shifted. A surprise tax hike vote over a long holiday weekend was met with a quick veto by a governor who’d dug in his heels. Lawmakers, though, stood their ground, with members of both parties coming together long enough to override.
