Olympia should adopt a $15 minimum wage

One of the best things that could happen to Tumwater and Lacey is for Olympia to adopt a $15 minimum wage.

Small businesses in Olympia would have to raise the price of the items they sell – thus driving shoppers outside the city.   More significantly – – small businesses would close their Olympia shops and move outside the city limits perhaps to Lacey or Tumwater.

For all the talk of how significant and important Olympia is – – the fact of the matter is – – that Olympia is just part of a larger community.  What happens in one city impacts all three cities – – sometimes to the negative, sometimes to the positive.

Nothing would make Lacey and Tumwater happier than to have Olympia adopt a $15 minimum wage.

All of that aside – – a $15 minimum wage takes many workers out of the market.  Why start a high school student or a college student out at $15 an hour when a 20 or 30 year-old with more experience will work for the same price?

A $15 minimum wage produces wage inflation.   If $15 is the floor, then everyone up the pay ladder will have to be paid more.   This increase in labor costs  – results in higher prices to the consumer – or a reduction in the number of employees.

In labor tight markets – such a Seattle – – you can get away with a super-high minimum wage.  It’s unemployment is below 5 percent.   In other markets such as Thurston County  – there are more people looking for work.

A $15 minimum wage skews the marketplace – – even more so here – – where businesses and customers can move easily.  And, they will move – –  to Lacey or Tumwater.