Raising minimum wage to $15 an hour reduces costly turnovers, new study finds

As it turns out, the effects of the minimum wage increase are more nuanced than previously espoused.

Raising minimum wage to $15 an hour reduces costly turnovers, new study finds
(Photo by David Ryder/Getty Images)
  • In 2017, a study came out that claimed raising the minimum wage to $15 an hour actually cost jobs.
  • The same researchers have published a new report this month, which offers new conclusions. Namely, that experienced workers have seen benefits from the pay increase.
  • The new data also suggests, simultaneously, that while there are less new entries into the Seattle workforce, companies have experienced a noticeable reduction in costly turnovers.

Let the crowing begin

Seattle Mayor Signs Bill Raising City's Minimum Wage To 15 Dollars An Hour

(Photo by David Ryder/Getty Images)

Last year, there was a lot of crowing by some in our political world after a study came out that suggested raising the minimum wage in Seattle to $15 an hour actually cost jobs. That is, on top of employers reducing hours in response to the city's new minimum wage law, in 2016, there was also 5,000 fewer low-wage jobs in the Emerald City than there would have been without the ordinance.

However, those same researchers have studied the latest data and have concluded something quite different. As it turns out, the affects of the minimum wage increase are more nuanced than previously espoused. It's affected different groups of workers differently.

Some real-world results, 1 year later

Workers Across The Country Demonstrate For Higher Minimum Wage

(Photo by David McNew/Getty Images)

For instance, for those who worked the most in low-wage jobs and those who worked basically part-time in the same jobs, the increase made a difference in their lives. In return for the wage increase, however, employers expected more experienced staff who could learn quickly.

Meanwhile, for those who hadn't yet entered the workforce before the wage increase but did after — for example, high school students entering the workforce for the first time — the benefit was less clear, and might have actually cost jobs in some cases. On the other hand, companies saw nearly a 10 percent reduction in costly turnovers.

If lawmakers can't do it nationally, perhaps it'll have to be done city-by-city? 

Fast Food Workers Rally For Higher Wages

(Photo by Joe Raedle/Getty Images)

The authors of said study are quick to state that their latest findings are not yet peer-reviewed, and that their study results might be specific to Seattle's high-demand economy, but the positive impacts the pay increase has had are tantalizing. Given that Seattle-based Amazon recently raised its minimum wage — in what was apparently a direct response to critics — it will now be worth looking at how the pay increase increase affects workers in different markets across the United States.

Massive 'Darth Vader' isopod found lurking in the Indian Ocean

The father of all giant sea bugs was recently discovered off the coast of Java.

A close up of Bathynomus raksasa

SJADE 2018
Surprising Science
  • A new species of isopod with a resemblance to a certain Sith lord was just discovered.
  • It is the first known giant isopod from the Indian Ocean.
  • The finding extends the list of giant isopods even further.
Keep reading Show less

Volcanoes to power bitcoin mining in El Salvador

The first nation to make bitcoin legal tender will use geothermal energy to mine it.

Credit: Aaron Thomas via Unsplash
Technology & Innovation

This article was originally published on our sister site, Freethink.

In June 2021, El Salvador became the first nation in the world to make bitcoin legal tender. Soon after, President Nayib Bukele instructed a state-owned power company to provide bitcoin mining facilities with cheap, clean energy — harnessed from the country's volcanoes.

The challenge: Bitcoin is a cryptocurrency, a digital form of money and a payment system. Crypto has several advantages over physical dollars and cents — it's incredibly difficult to counterfeit, and transactions are more secure — but it also has a major downside.

Crypto transactions are recorded and new coins are added into circulation through a process called mining.

Crypto mining involves computers solving incredibly difficult mathematical puzzles. It is also incredibly energy-intensive — Cambridge University researchers estimate that bitcoin mining alone consumes more electricity every year than Argentina.

Most of that electricity is generated by carbon-emitting fossil fuels. As it stands, bitcoin mining produces an estimated 36.95 megatons of CO2 annually.

A world first: On June 9, El Salvador became the first nation to make bitcoin legal tender, meaning businesses have to accept it as payment and citizens can use it to pay taxes.

Less than a day later, Bukele tweeted that he'd instructed a state-owned geothermal electric company to put together a plan to provide bitcoin mining facilities with "very cheap, 100% clean, 100% renewable, 0 emissions energy."

Geothermal electricity is produced by capturing heat from the Earth itself. In El Salvador, that heat comes from volcanoes, and an estimated two-thirds of their energy potential is currently untapped.

Why it matters: El Salvador's decision to make bitcoin legal tender could be a win for both the crypto and the nation itself.

"(W)hat it does for bitcoin is further legitimizes its status as a potential reserve asset for sovereign and super sovereign entities," Greg King, CEO of crypto asset management firm Osprey Funds, told CBS News of the legislation.

Meanwhile, El Salvador is one of the poorest nations in North America, and bitcoin miners — the people who own and operate the computers doing the mining — receive bitcoins as a reward for their efforts.

"This is going to evolve fast!"
NAYIB BUKELE

If El Salvador begins operating bitcoin mining facilities powered by clean, cheap geothermal energy, it could become a global hub for mining — and receive a much-needed economic boost in the process.

The next steps: It remains to be seen whether Salvadorans will fully embrace bitcoin — which is notoriously volatile — or continue business-as-usual with the nation's other legal tender, the U.S. dollar.

Only time will tell if Bukele's plan for volcano-powered bitcoin mining facilities comes to fruition, too — but based on the speed of things so far, we won't have to wait long to find out.

Less than three hours after tweeting about the idea, Bukele followed up with another tweet claiming that the nation's geothermal energy company had already dug a new well and was designing a "mining hub" around it.

"This is going to evolve fast!" the president promised.

How Pfizer and BioNTech made history with their vaccine

How were mRNA vaccines developed? Pfizer's Dr Bill Gruber explains the science behind this record-breaking achievement and how it was developed without compromising safety.

How Pfizer and BioNTech made history with their vaccine
Sponsored by Pfizer
  • Wondering how Pfizer and partner BioNTech developed a COVID-19 vaccine in record time without compromising safety? Dr Bill Gruber, SVP of Pfizer Vaccine Clinical Research and Development, explains the process from start to finish.
  • "I told my team, at first we were inspired by hope and now we're inspired by reality," Dr Gruber said. "If you bring critical science together, talented team members together, government, academia, industry, public health officials—you can achieve what was previously the unachievable."
  • The Pfizer-BioNTech COVID-19 Vaccine has not been approved or licensed by the Food and Drug Administration (FDA), but has been authorized for emergency use by FDA under an Emergency Use Authorization (EUA) to prevent COVID-19 for use in individuals 12 years of age and older. The emergency use of this product is only authorized for the duration of the emergency declaration unless ended sooner. See Fact Sheet: cvdvaccine-us.com/recipients.

Keep reading Show less
Quantcast