Cause, Effect, and Correlation: Seatac

As much as I want to see the Seatac, WA, $15 minimum wage succeed, this article seems weak to me. In fact, Seatac is a very specific case of where to test a higher minimum wage.

Seatac, of course, is named after a huge airport situated there: Seattle Tacoma International Airport. If you’re flying on an airline to Seattle, you’re going to go through SeaTac. When you leave Seattle on an airline, you’ll wait for your plane at SeaTac. If you’re hungry while you’re waiting, you’re not going to leave the town of SeaTac because the burger is too expensive; SeaTac businesses have a built-in clientele. There are some off-site businesses that have to compete for business, but even there, being a hotel or restaurant near a major airport guarantees some business.

The article crows about expansion of a nearby hotel, a restaurant owner expanding, and expansion of the airport itself. That last part, the expansion of the airport, has almost nothing to do because of the minimum wage. When was the last time you chose to fly to a city because its airport workers were well-paid and happier than other airport workers? If an airport needs to expand, it’s because its region is thriving, and we’re talking about a much larger area than the town of Seatac.

If an airport is booming enough that it needs to expand, it stands to reason that enough people are coming and going to bring more business to nearby businesses. Yes, if prices in Seatac got too outrageous, a traveler stranded at SeaTac overnight (been there, done that, summer of 2000) might take a taxi to the next town to find a cheaper hotel, but, honestly, hotel rates are driven by the cost of land near the airport more than the cost of labor near the airport. If there’s a room available at a nearby hotel and it’s 11 PM and you’re stranded, you don’t haggle about price or look 10 miles farther away for something 10% cheaper; you pay the money and are grateful to have a good place to sleep that night instead of in a terminal.

The article doesn’t even say that the expanding restaurant owner is expanding in Seatac; he may own restaurants throughout the Seattle area and be expanding in other towns, or he may be expanding because the airport is growing, not because Seatac workers are happier and more productive.

Honestly, if I turned in a paper like this in high school, I’d be graded harshly for such weak arguments.

I hope the $15 minimum wage in Seatac proves as successful in other places; I believe the premise that better paid workers are more stable and more productive. But I don’t think the Seatac experiment has wide implications for the vast majority of towns that aren’t built around a major monopoly like an international airport. It disproves the worst-case sceanrios about the elasticity and price sensitivity of some markets, but it might not help someone in, say, Madison, Wisconsin decide whether or how much to raise wages if nearby towns aren’t considering the same.

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