Friday, October 21, 2016

More than a quarter of all Spokane County jobs fall below the Initiative 1433 minimum wage threshold

Posted By on Fri, Oct 21, 2016 at 2:53 PM

More than a quarter of the jobs in Spokane County pay less than $12.23 an hour. Initiative 1433 would change that, impacting fast food joints and coffee stands in particular.
  • More than a quarter of the jobs in Spokane County pay less than $12.23 an hour. Initiative 1433 would change that, impacting fast food joints and coffee stands in particular.

We've written a lot about the minimum-wage hikes proposed by Initiative 1433 — reaching $13.50 by 2020 — but so far, we haven't really gotten into just how big that change would be for Spokane County. 

In other words, just how many local jobs would have their pay structure altered because of the initiative? And how much would that cost local businesses? 

This week, Anneliese Vance-Sherman, the regional economist for King County, sent over a rough estimate from Scott Bailey of the Washington Employment Security Department.

He essentially creates a "What If" scenario.

Like, say, Earth 2, from The Flash, except instead of the alternate-universe being plagued by the malevolent speedster supervillain Zoom, this Earth 2 is exactly the same in every way except that Initiative 1433 was already fully implemented in Washington state. Then he takes that lens and applies it to the economic situation last year. 

First, Bailey provides a crucial caveat: 

"This exercise does NOT imply what the impact of an increase in the minimum wage would be, as employers may react to an increase in a number of ways (e.g. reduce profits, increase prices, increase automation, reduce hours worked, up-skill lower-wage jobs, etc.)" 

In other words, it just gives a sense of the scope of the required wage increases, not their actual impact. 

— Last year, there were 226,457 jobs in Spokane County. 

— Over 15,000 of those jobs in Spokane County were minimum-wage jobs, about 6.7 percent of the total. 

— But a much larger number of jobs — 59,608 — were paid below $12.23 an hour. Why is that strangely specific number important? Because, assuming a typical rate of inflation, that's would bring us to $13.50 by 2020: All these jobs — 26.3 percent of jobs in the county in 2015 — would have to pay higher wages if Initiative 1433 is passed. 

— Of course, many of these jobs are part-time jobs. So it's also instructive to lump part-time jobs together to look at the number of full-time equivalent jobs in the county. Last year, 3.2 percent of full-time equivalent jobs in 2015 paid minimum wage while 18.5 percent were paid below the initiative's proposed threshold. 

— Okay, that's the worker angle. But about how much more in salaries, theoretically, should Spokane County expect to pay? More than $96.6 million in today's dollars, the data suggests  — about 1.1 percent of their total payroll. 

That number differs from county to county, the data shows. Spokane has a lot more low-wage jobs than Snohomish County, so far fewer jobs would be impacted.  

Nearly a third of Lewis County is paid below $12.23 an hour currently, compared to less than 6 percent in Whitman County.

But, of course, the impact is radically different for different industries. The construction and manufacturing industries already pay their workers relatively well, so they're unlikely to see much of a change in their payroll at all. But the agricultural, fishing and forestry industries would see a significant big bump. 

And for fast-food joints and coffee shops? The impact would be massive. Taking into account the minimum wage increases already scheduled in Seattle, fast food joints and coffee shops statewide would have had to spend more than 10 percent more on average on their entire payroll to comply with the initiative. 
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