Let’s see how this goes during the next two to three years shall we? It’s not a done deal, but SeaTac Proposition 1 looks like it will pass, requiring businesses to pay hospitality and transportation workers a minimum wage of $15 per hour. The previous minimum wage was $9.19, but I’m not sure what the average pay was for an entry-level employee.
Businesses will also have to provide paid sick leave. SeaTac, Wash. is a 10 square mile area including the international airport and surrounding areas to the west of I-5. The population is about 27,000 and the current unemployment rate is 6 percent. The state’s current unemployment rate is 6.8 percent.
A small business with 15 employees working a 40 hour week at $10 per hour had a payroll of $6,000 per week. If the owner or management makes no changes, payroll costs will make a huge jump to $9,000 per week, that’s a 50 percent increase, and that does not include the cost of paid sick leave. Where do people think businesses will come up with this extra 50 percent to cover payroll costs? Owners and management have three options.
- Raise the price of services or goods.
- Cut their own pay.
- Reduce the payroll.
In reality, businesses will do a combination of all three, but tell me how this will help employees currently making minimum wage? To a certain extent, SeaTac has a captive audience since some of the businesses are within an airport and people do like the convenience of staying near the airport when they are flying in and out. I’ve stayed in the exact area that will be effected in the past, and I’ll be damned if I’m going to pay a higher price for a hotel room that has grouchy managers and owners who can’t afford the staff to keep the place clean.
I’ve been looking for some good data sets specifically for the SeaTac area and having a tough time doing so. The numbers exist. If this goes through, SeaTac needs to be completely honest and answer the following questions.
- How many jobs – as of today – are in the area that would be effected by the new rules?
- Two years from now how many of those jobs remain? Are there more or less jobs?
- What is the current unemployment percentage – specific to SeaTac – for the 16 to 24-year-old age group? Break out those percentages by male, female, white, black, hispanic, asian and other race groups.
- Two years from now, what is the unemployment percentage for those same groups?
- What were the total gross sales and net revenues of the businesses effected by the new rules in 2013?
- What are the gross sales and net revenue numbers two years from now?
- What is the percentage of families living under the poverty line in SeaTac in 2013?
- What is the percentage of families living under the poverty line two years from now?
Hat tip to Jim Hoft at Gateway Pundit.