Abstract
In 1938 the first minimum wage was imposed (Fair Labor Standards Act) in the United States. It was $0.25 an hour. It had an immediate impact on low wageworkers across the country, particularly African-American women employed in the tobacco industry. Their wages went from earning a piecework rate of about $0.16 an hour to $0.25 an hour with their wages reaching $0.40 an hour by 1945. It was a win-win situation for the tobacco industry and its workers because the industry continued to grow. Theory predicts that employment should decrease if wages are raised higher than the equilibrium wage rate, but the evidence is mixed. Many researchers either show an increase in employment for low wage industries or no change although that is not universal. The Federal government has not raised its minimum wage rate of $7.25 an hour since 2009. The city of Seattle WA approved a set of minimum wage increases on July 2, v 2014 beginning in April 2015 at $9.47 an hour and reaching $15.00 an hour for employers of over 500 employees in January 2017. This study looks for employment impacts to restaurant workers during the period January 2014 to August 2015 for Seattle and other cities across the country where there was a minimum wage increase as well as for cities where the minimum wage remained at the Federal level. Although Seattle has been the most aggressive in raising its minimum wage, there is no evidence that there was any impact on its employment over the period January 2014 to August 2016, and overall that is also true for the other cities in the study.