Measure to lift minimum wage to $13.50 statewide has Washington dividedOct. 17, 2016 | By Janet I. Tu, Seattle Times business reporter
For Martha Camargo Castañeda, an agricultural worker in Wapato, Yakima County, an increase in the state minimum wage would mean she could afford a few more basics for herself and her son.
She makes $10 an hour at her full-time job and counts on food stamps to make ends meet. She juggles the bills to decide each month whether she’ll pay, say, the electric or water bill.
Her 11-year-old son’s back-to-school clothes this fall were purchased mainly at yard sales and Goodwill, though she did buy him one new set of clothes — “so he doesn’t feel bad,” she said through an interpreter.
The minimum-wage boost and paid sick leave called for in Initiative 1433 on the Nov. 8 ballot would mean “I won’t have to go to work sick anymore,” said Camargo Castañeda, who is recovering from an ankle injury. “And I’ll have money to spend on the basics. That’s all I’m looking for.”
I-1433 would raise the state’s minimum wage over four years to $13.50 by 2020. The first jump, from the current $9.47 to $11 an hour, would start Jan. 1. (Under current law, the state minimum wage is set to rise on Jan. 1 to $9.53 an hour.)
The initiative also requires paid sick leave for employees.
Labor unions and workers advocates say the state’s current minimum wage isn’t enough to live on and that a boost would mean workers have more to spend. They also argue that many workers don’t have access to paid sick leave, posing a public-health problem.
Several business groups oppose the initiative, saying that while Seattle’s booming economy can support a high minimum wage, the rest of the state isn’t faring so well. Boosting the minimum wage in those areas could lead to higher prices and cuts in jobs and work hours, they say.
“We’re mostly a minimum-wage area as it is,” said Sandra Bain, owner of Magoo’s Restaurant in Omak, Okanogan County. “We have to keep our prices down. There’s so much unemployment and people on welfare.”
At the restaurant she’s owned for 26 years, Bain employs six people, three earning minimum wage. I-1433 would affect her bottom line, just as she faces increases in taxes, insurance rates and food costs.
“We’ll have to pass it on to the consumers,” she added. “And a lot of the consumers around here can’t afford it.”
4 years of raises
Initiative 1433 would require employers to pay employees age 18 or older at least $11 an hour starting next year, $11.50 in 2018, $12 in 2019, and $13.50 in 2020, with subsequent annual adjustments for inflation.
Paid sick leave would be earned at the rate of one hour for every 40 hours worked, starting in 2018.
Employers in cities that have higher minimum wages or more generous sick-leave policies, including Seattle and SeaTac, would abide by the local laws.
The initiative’s supporters have raised far more than the opponents.
Raise Up Washington, the group behind I-1433, has raised about $3.9 million, mostly from labor unions, Seattle venture capitalist Nick Hanauer, and a Palo Alto, Calif.-based group called The Fairness Project that is also supporting minimum-wage initiatives in Arizona, Colorado and Maine.
No on I-1433 has raised about $54,000, mostly from the Washington Restaurant Association, Washington Food Industry Association, Washington Retail Association and Washington Farm Bureau.
In the most recent Elway poll, conducted in August, 57 percent of Washington voters surveyed supported I-1433, with 31 percent against, and 12 percent undecided.
Jack Sorensen, spokesman for Raise Up Washington, said the state’s current minimum wage is “not enough for a single person to afford a one-bedroom” in Washington state.
Raise Up Washington estimates some 730,000 Washington workers who are currently making less than $13.50 an hour would be affected by I-1433, as would about a million workers it says are not getting paid sick leave.
The state Employment Security Department says Washington had about 151,300 workers who made the minimum wage of $9.47 last year. The department also found that fewer than half the firms it surveyed in 2013 offered paid sick leave to full-time employees, and less than a quarter offered it to part-time employees.
“Too many Washington parents have to choose between staying home to care for a sick child and losing a paycheck,” said Terri Helm-Remund, a school nurse who spoke at a Raise Up Washington news conference.
At another event held by the group, U.S. Deputy Secretary of Labor Chris Lu said that states with higher minimum wages have had higher rates of job growth.
The Department of Labor also highlighted a 2014 letter signed by hundreds of economists who said that increases in the minimum wage have had little or no negative effect on jobs and could have a “small stimulative effect” on the economy.
Opponents of I-1433 say that by raising the cost of doing business, the initiative would likely lead to job or work-hour cuts and businesses leaving the state.
Yvette Ollada, spokeswoman for No on I-1433, said that while Washington has one of the highest minimum wages, it also has one of the highest unemployment rates.
Washington’s 5.7 percent jobless rate in August tied for sixth highest in the country. And while King County enjoyed a low 3.9 percent unemployment rate in August, the rates in other counties were higher — sometimes significantly so.
The economy of the state, she said, “is not Seattle. There’s not a big boom here.”
Anthony Anton, president and CEO of the Washington Restaurant Association, said I-1433’s first jump to $11 in January doesn’t give businesses enough time to plan, and that the initiative “tries to make a single solution for the whole state,” to the detriment of restaurants in rural communities.
The average sales per site for a restaurant in King County last year, for example, was $1.08 million, while it was $647,000 in Yakima County, he said.
Anton said he would have preferred to see something along the lines of the measure passed earlier this year in Oregon that increases the minimum wage through a geographically tiered system, with the minimums higher in metro Portland than in midsize and rural communities.
In Seattle, where a minimum-wage law took effect last year that will bring at least $15 an hour to all workers by 2021, a city-commissioned report said the law helped to raise the hourly pay for low-wage workers from $9.96 to $11.14 during the time period studied.
The report also concluded that while the employment rate for such workers was better than the historical average, due to the booming overall economy, the minimum-wage law itself appeared to have slightly lowered their employment rate and hours worked, relative to regional trends.
Researchers for the study cautioned that the results were early and incomplete, and not generalizable to other cities or to the state.
“A blunt tool”
JoReen Brinkman, co-owner of JCB Hospitality, which runs several quick-serve restaurants in Pullman, Whitman County, said “It would be a very big financial hit” on her business if I-1433 passes.
Her restaurants compete with those in Moscow, Idaho, just nine miles away, where the minimum wage is $7.25.
“The initiative is a blunt tool. There’s no way to fine-tune it,” she said.
Glen Bachman, general manager of Everett Mall, estimates that his budget next year will increase 8 percent if I-1433 passes. He might have to cut back on contractor services such as landscaping, maintenance and housekeeping, he said.
But some business owners support the initiative.
Shahrokh Nikfar, owner of Mediterrano restaurant and Caffee Affogato coffee shop in downtown Spokane, has 13 employees and offers them up to five days of paid sick leave per year.
Nikfar, who also has a full-time job as assistant director at Northwest Fair Housing Alliance, counts on his employees to take care of his eateries.
“I invested everything in my businesses,” he said. “My staff’s well-being is important to me. Because they know I care about them, they take care of my business.”
Mary Bell is making $11 an hour as an emergency medical technician with Lincoln Hospital in Davenport, Lincoln County, after starting at $10 four and a half years ago.
Bell has a second job, as a medical assistant at the hospital, which pays more and provides paid sick leave. But she wishes she could be a full-time EMT.
An increase in pay would help her and her husband pay off some debts, but more importantly, “As an EMT, sometimes I feel like we’re not recognized,” she said. “I feel that extra income would make me feel a little better.”
Additionally, she said, “I’d make a little more money so it would benefit the businesses in Davenport, since I would be spending money there.”