Posts filed under “Wages & Income”
@TBPInvictus The opening paragraph of this CNNMoney piece (over one year ago) perfectly captures a growing sentiment that I’ve seen making the rounds more frequently of late: As protesters across the country call for the fast-food chains to raise their wages, a number of companies have begun experimenting with new technology that could significantly reduce…Read More
Intern season is over and all the college students are back at school. Seems like a good time to remind those of you about to assume a lot of debt to pay for all that learnin’ may want to take a look at this chart below. Note the X-axis is gender ratio — the further…Read More
Searching for Higher Wages Luis Armona, Samuel Kapon, Laura Pilossoph, Ayşegül Şahin, and Giorgio Topa Liberty Street Economics, September 2015 Since the peak of the recession, the unemployment rate has fallen by almost 5 percentage points, and observers continue to focus on whether and when this decline will lead to robust wage growth. Typically,…Read More
@TBPInvictus (Pun intended in the title) There are myriad factors that typically go into determining the success or failure of any legislative policy. It will be no different with regard to the minimum wage. Let’s turn (again) to Seattle, currently Ground Zero for the minimum wage debate, where the minimum wage was recently kicked up…Read More
This is fascinating look at how exposed the average American household is to the equity markets. On average, about 55% of adults have equity exposure, and it amounts to less than 15% of their total assets. I’d wager that is a very top heavy distribution both in percentage and asset size. Source: The Economist…Read More
@TBPInvictus here. [File under: Petard, hoist on one's own] Earlier this month, AEI “scholar” Mark Perry was spotted using a dubious metric regarding minimum wage. Given the point his ideology was trying (apparently desperately) to prove, Perry proclaimed Seattle’s newly-hiked minimum wage a failure: As evidence to support his claim, Perry showed the following chart:…Read More
Since today is the 11th anniversary of first-day trading in Google shares after its initial public offering, I wanted to bring to your attention a recent bit of gamesmanship that has been taking place with its search function. Google rose to its position of authority and influence because it invented a better way to navigate…Read More
@TBPInvictus here: As I recently highlighted, Mark Perry – an AEI scholar and professor of economics - is playing very fast and loose with data surrounding employment in Seattle post its recent minimum wage hike. In his recent “report” on the subject, which was picked up far and wide by conservative outlets, Professor Perry wrote (emphasis mine):
“In June of last year, the Seattle city council passed a $15 minimum wage law to be phased in over time, with the first increase to $11 an hour taking effect on April 1, 2015. What effect will the eventual 58% increase in labor costs have on small businesses, including area restaurants? It’s too soon to tell for sure, but there is already some evidence that the recent minimum wage hike to $11 an hour, along with the pending increase of an additional $4 an hour by 2017 for some businesses, has started having a negative effect on restaurant jobs in the Seattle area. The chart below shows that the Emerald City MSA started experiencing a decline in restaurant employment…”
The minimum wage hike took place in the city of Seattle, population ~650,000. What’s all this talk about “area restaurants,” “the Seattle area,” and the “Emerald City MSA”? (Note that companies with under 500 employees — that includes most restaurants — the actual date is 2021, not 2017).
This is simply someone with an agenda deliberately being intellectually dishonest in an attempt to mislead readers and spread misinformation widely through the conservative echo chamber. It’s a tried and true method that, unfortunately, has worked time and again.
When Perry talks about Seattle (city proper) and the “Seattle area,” you may not know it, but he’s talking about two very, very different areas.
Legislatively, economically, legally and socially, these are two completely different regions. Perhaps most important of all, in terms of data collection for the subject at hand, the map below shows exactly how different they are:
Seattle, the city in question whose minimum wage is now $11, on its way to $15 over the next 3-7 years – is (as best as Paintbrush lets me draw it) the area within the red oval. The “Seattle area” or “Emerald City MSA,” as Perry misleadingly wrote, are the three more darkly shaded counties – Pierce (bottom), King (middle), and Snohomish (top) – engulfing Seattle and making it look, well, geographically tiny in comparison.
The MSA Perry referenced as being impacted by the new minimum wage has an overall population of some 3.6 million versus the aforementioned population of Seattle at about 650,000. What’s to compare? As Media Matters put it in their takedown of Perry’s work: “The employment trends of the entire region are not representative of the impact of a local wage ordinance in a single city.” But Perry does not care, as he’s repeatedly referenced the same irrelevant data point multiple times on Twitter. He is exactly the man whom Upton Sinclair was referring to when he said, “It is difficult to get a man to understand something, when his salary depends upon his not understanding it.”
Why would anyone look at a MSA when it is the city – and ONLY THE CITY - that has the new minimum wage law. The New York equivalent would be to suggest that perhaps an ordinance in New York City might somehow have a ripple effect in White Plains, N.Y., or Hackensack, N.J. After all, they are both part of the greater tri-state region (there is a massive New York-Newark-Jersey City MSA). It’s absurd on its face, and any honorable analyst understands this.
This suggests that Perry is engaging in fraud or ignorance. Neither reflects on him favorably. Perry should apologize and AEI should retract that piece in entirety.
An analyst as intellectually dishonest as Perry apparently is could do something similar on the flip side:
Seattle Passes Higher Minimum Wage; Area Food Biz Employment Now at 134,000!
First, I’d point out that at the end of 2013, the most recent year for which we have good statistics on the city itself, Seattle city employment in two broad categories combined – Arts, Entertainment & Recreation and Accommodation & Food Services – totaled about 40,000, as seen below.
Source: American FactFinder
Then, I’d trumpet the “fact” that the “Seattle area” or “Emerald City MSA” (see what I did there?) has more than tripled that total to a whopping 134,000. I’d then claim victory at having “demonstrated” that the ordinance I supported was having its desired effect.
Source: St. Louis Fed
But I’d never do such a thing. Most reputable people wouldn’t.