Business & Economy

What can Los Angeles learn from Seattle's higher minimum wage?

Seattle's minimum wage increase didn’t affect employment in Seattle’s restaurant industry, according to a study from UC Berkeley’s Institute for Research on Labor and Employment.
Seattle's minimum wage increase didn’t affect employment in Seattle’s restaurant industry, according to a study from UC Berkeley’s Institute for Research on Labor and Employment.
File photo by Paula Connelly/Getty Images

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A new study says a higher minimum wage has not led to fewer jobs in Seattle's restaurant industry, a finding that may have lessons for Los Angeles County as it prepares for another wage increase.

On July 1, the minimum wage in Los Angeles County for companies with more than 25 employees will go from $10.50 to $12 an hour, part of the gradual rise to $15 an hour in 2020.

In 2014, Seattle became the first major city in the U.S. to start moving towards a $15 minimum wage. Like the law L.A. later passed, it’s been going up in phases, reaching $13 for some businesses last year. That increase, from $9.50 to $13, didn’t affect employment in Seattle’s restaurant industry, according to a study from UC Berkeley’s Institute for Research on Labor and Employment. 

"The evidence collected here suggests that minimum wages in Seattle up to $13 per hour raised wages for low-paid workers without causing disemployment," the study says. 

L.A.'s minimum wage for businesses with more than 25 workers will rise to $13.25 in a year.

Sylvia Allegretto, one of the report's co-authors, cautions against taking too many lessons from Seattle.

"There’s many reasons why it might be the same outcome and there’s many reasons why it might be different," she said. "They’re different labor markets with different types of workers."

For one thing, the median wage in Seattle is more than $80,000 compared with around $55,000 in L.A. County, so an increase to $15 dollars an hour in L.A. is a much more dramatic salary increase. L.A's workforce is also more diverse and has far more immigrants.

Allegretto says no one knows exactly how the higher minimum wage will ultimately affect employment, because there's never  been a wage increase on this scale in L.A. County.

"We're keeping an open mind," she said.