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Almost everyone agrees that there should be a minimum wage. The question is how high it should be. At some point, forcing employers to pay low-skill workers more will lead them to fire some of them or hire fewer of them and you'll end up hurting more people than you'll help. But where is that point? Is it $8? $10? $15? $30?
This is one reason that both proponents and detractors of a much higher minimum wage should be excited to see Seattle boosting their minimum wage to $15. Though the plan is a bit less radical than its headline number — the new minimum wage phases in over six years, and as Jared Bernstein points out, that will give inflation time to erode the value of the $15 wage to about $12.21 in today's dollars — it will still make Seattle the highest minimum wage city in the country.
That gives us something to study. If Seattle's phase-in proceeds without much job loss that's more evidence that the economy can absorb a higher minimum wage. If, by contrast, Seattle sees sharp job losses compared to similar cities with lower minimum wages, or if low-wage employers begin moving outside the city lines, that will be evidence that the tradeoffs are more severe than the law's supporters hoped.
Cities aren't countries, of course. It's a lot easier for an employer to move to another city than another country, so a federal minimum wage might have a bit more room than a citywide minimum wage. Nevertheless, this will be a good test. Both supporters and opponents of a higher minimum wage should be eager to see how it comes out.
