February 5, 2016
Hiring at restaurants, hotels and other leisure and hospitality sector venues slowed markedly last year in metro areas that saw big minimum-wage hikes, new Labor Department data show.
Wherever cities implemented big minimum-wage hikes to $10 an hour or more last year, the latest data through December show that job creation downshifted to the slowest pace in at least five years.
Liberals fighting for a dramatic increase in the minimum wage have insisted that there would be a negligible impact on job creation. Though the data are preliminary and overly broad, Washington D. C., Oakland, Los Angeles, San Francisco, Seattle and Chicago seem to be finding out that the reality isn’t so benign.
A slowdown in job growth can fly below the radar, at least for those who aren’t seeking low-wage work. But the risk of raising the minimum wage too high became fairly obvious last month, whenWal-Mart (WMT) bolted from Oakland and Los Angeles and scrapped plans for two stores in low-income areas of D. C.
The big shortcoming in the available data for 5 of the 6 cities is that they cover broad metro areas, far beyond the city limits where wage hikes took effect. Still, the uniform result of much slower job growth in the low-wage leisure and hospitality sector, even as the pace of job gains held steady in surrounding areas, sends a pretty powerful signal.
This post was published at David Stockmans Contra Corner By Jed Graham Investor’s Business Daily /.
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