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January 12 2018

How Minimum Wage Hike Killed the Five Dollar Footlong in Seattle

by Charlotte Hays

Subway is reviving promotion of its "five-dollar footlong, " but patrons in Seattle won't be able to avail themselves of the offer. A sign at one Subway outlet says:

Dear Subway Patrons,

Unfortunately, we are not participating in the $4.99 footlong promotion. The cost of doing business in the City of Seattle is very high. We are facing the highest Minimum Wage in the Nation, Paid Sick Leave, ACA, Secure Scheduling, Soda Tax and much more. Keep an eye on this sign because I hope to announce $1 off [on various products].

The message, signed by a franchise manager, was spotted by Kirstin Ellis of the Washington Policy Center and sent along to Eric Boehm at Reason, who observes:

Sadly, the consequences of high minimum wages, excessive taxation, and mandate-happy public policy are not limited to the death of cheap sandwiches. The cost of doing business in Seattle is higher than the Space Needle, and the unintended consequences of those policies are piling up too.

The biggest cost driver, as Jones' sign mentions, is Seattle's highest-in-the-nation minimum wage. It went from $9.47 to $11 per hour in 2015, then to $13 per hour in 2016, with a further increase to $15 per hour planned.

The result? According to researchers at the University of Washington's School of Public Policy and Governance, the number of hours worked in low-wage jobs has declined by around 9 percent since the start of 2016 "while hourly wages in such jobs increased by around 3 percent." The net outcome: In 2016, the "higher" minimum wage actually lowered low-wage workers' earnings by an average of $125 a month.

And the footlong won't be the only edible that costs more:

Compounding the misery is the city's new soda tax. By tacking another 1.75 cents onto every ounce of sweetened beverage purchased within the city, then-mayor Ed Murray promised, Seattle could subsidize trips to the farmers market, pay for free community college, and roll back "white-privileged, institutional racism." Racism has yet to disappear in Seattle, but as Reason's Christian Britschgi highlighted earlier this week, the tax has had the more immediate effect of hiking the price of a can of Coke by 20 cents, making a typical 36-can case of soft drink now $7.56 more expensive.

Seattle's progressives, who know what's best for their social inferiors, are probably thrilled that workers will have to curb cola consumption (so unattractive--don't they know bottled water is more socially acceptable?),  but curbing job availability, which generally comes with arbitrary minimum wage hikes, will inflict a lot of pain on the same workers--or, sorry, ex-workers, in many instances, because of the price of doing business in an excessively regulated local economy.

 

Independent Women's Forum is an educational 501(c)(3) dedicated to developing and advancing policies that aren’t just well intended, but actually enhance people’s freedom, choices, and opportunities. IWF is the sister organization of the Independent Women’s Voice.​
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