The best way to fight higher prices? Higher wages
(Photo by Brandon Bell/Getty Images)
Every year, prices for things like food and housing go up. Every year, Washington workers get a cost-of-living adjustment to the minimum wage so they and their families can keep up. And every year, someone makes the tired argument that rising prices are workers’ fault and we should let their wages fall behind.
Blaming rising costs on the minimum wage is one of the oldest anti-worker tricks in the book. It’s never true, but since it’s once again resurfaced in The Seattle Times’ opinion pages, it’s once again time for business and labor leaders like us to put it to bed.
Eleven years ago this spring and summer, fast food workers in Seattle were outside their stores striking for higher wages while just on the other side of the window their bosses threatened to fire them. What began as agitation became legislation, with SeaTac and Seattle passing a $15 minimum wage and the rest of the state following suit with Initiative 1433 and the Raise Up WA campaign in 2016. Seattle – and Washington – led the rest of the country on this issue.
It’s not the only leaderboard we’re on. Because of Washington’s strong wages and labor standards, we’re consistently ranked the best state economy, including in 2024 for the third consecutive year, and among the best places to do business and to work. It’s because – as we said all along – a stronger minimum wage is better for workers, better for businesses, and better for our economy. Working- and middle-class Washingtonians are our communities’ true job creators. When people have more money, they spend it at local businesses, businesses make more and hire more people, which grows the economy from the middle out.
Families everywhere are paying higher prices for energy, groceries, and housing. Across the board, everything is more expensive, including for restaurants and small business owners who are paying more for ingredients, supplies, rent and manufacturing.
But the tired argument that higher wages lead to higher prices isn’t true, and has never been true. Decades of research has proven there’s no connection, including a study from the University of Washington showing prices at restaurants and grocery stores here in Seattle didn’t meaningfully increase as a result of higher wages after Seattle’s minimum wage implementation.
Finally, if wages were to blame, then there wouldn’t be breathless media coverage about skyrocketing prices in any of the 20 states that follow the federal minimum wage of $7.25 – which hasn’t been raised since 2009.
In short, it’s not the wages. And without cost-of-living adjustments, workers would materially take a pay cut every year, and small businesses would have fewer customers.
On the contrary, cost-of-living adjustments to the minimum wage are the best tool states like Washington have to fight inflation and actually help keep inflation under control. Businesses like Oliver’s Twist need customers. To be customers, workers need to be paid enough. When prices go up – for small businesses and consumers – it’s even more critical to ensure workers are paid enough to spend money in our local economy.
The columnist who took this year’s pass at Washington’s wage suggested we should “put these increases back into the hands of the people.” The good news is we already have – twice, in fact.
In 1998 Washington voters approved a new minimum wage above the federal standard, and approved tying it to inflation so as the cost of living went up in the years to come, families could keep up.
And again, in 2016, Washington voters approved Initiative 1433, which raised Washington’s minimum wage to catch up and ensured it would keep up by again enshrining cost-of-living adjustments in our state’s minimum wage law.
Twice now voters have recognized the importance of ensuring wages keep up with costs, which will always increase, regardless of wages.
So we agree – let’s look to voters, and the voters have been clear.
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