The internet has made fact-checking easy and ubiquitous. But much of the problem with news and opinion these days is less that the facts are wrong than they are incomplete. In other words, relevant information is missing. Without that information we cannot evaluate the significance of the facts that have been provided. Not that people don't jump to conclusions anyway - especially if they're partial to certain narratives of what is or should be.
Events and stories are often newsworthy because they speak to the issues of the day: foreign policy, poverty, politics, climate change, etc. What goes in and is left out of a news item shapes our understanding of what's right and wrong about the world, which in turn implies a specific approach to fixing the wrongs.
Well, you can't fix a problem if you're lacking essential information about the problem.
This series of posts will focus on news stories that illustrate journalistic acts of omission so prevalent in the news media. We'll start with the following news item:
Minimum Wage Increases Do Not Reduce Jobs: New Study
“The study is the first in a series from UC Berkeley researchers. ... [The report says] Seattle's new minimum wage law raises wages for low-paid workers and does not reduce the number of available jobs.”
The news articles about the above study are pretty much all the same, which is to say details were minimal. Click on the link and you'll see what I mean. Seeking more information, all I found was a policy brief from the Institute for Research on Labor and Employment titled Seattle’s Minimum Wage Experience 2015-16. Some highlights:
“Seattle implemented the first phase of its minimum wage law on April 1, 2015, raising minimum wages from the statewide $9.47 to $10 or $11, depending upon business size, presence of tipped workers and employer provision of health insurance. The second phase began on January 1, 2016, further raising the minimum to four different levels, ranging from $10.50 to $13, again depending upon employer size, presence of tipped workers and provision of health insurance….
We analyze county and city-level data for 2009 to 2016* on all employees counted in the Quarterly Census of Employment and Wages and use the “synthetic control” method to rigorously identify the causal effects of Seattle’s minimum wage policy upon wages and employment….
Our methods ensure that our synthetic control group meets accepted statistical standards, including not being contaminated by wage spillovers from Seattle. We scale our outcome measures so that they apply to all sectors, not just food services….
Our results show that wages in food services did increase—indicating the policy achieved its goal—and our estimates of the wage increases are in line with the lion’s share of results in previous credible minimum wage studies. Wages increased much less among full-service restaurants, indicating that employers made use of the tip credit component of the law.”
Omission alert! Something the authors fail to mention: unemployment in Seattle/King County plummeted during the study period, as the following chart makes clear:
So local economic conditions improved immensely during the period of study. Improved economic conditions most likely resulted in higher demand for restaurant meals, which in turn would have put upward pressure on wages and increased employment in the food service industry. With the influx of well-paid tech workers in the region, I would imagine that many food service operations were able pass on their higher labor costs to customers, in the form of higher prices.
Omission alert! We don't even know what these higher costs were, because the authors don't tell us. We are told the minimum wage increase was between $10.50/hour to $13/hour but have no idea how much wages actually changed during the study period. Nor do we know the typical wages for the same food service positions at the beginning of the study period**. In other words, we don't know how many workers were affected by the new minimum wage rules nor how much they were affected.
It is already pretty well established that small increases in the minimum wage aren't all that disruptive in healthy economies where increased costs are easily passed on to consumers in the form of higher prices. In healthy economies, the added cost of higher wages may also be neutralized by productivity improvements without accompanying reductions in hiring or employee hours. A more interesting study on the effects of a minimum wage hike would have looked at less affluent areas of Washington State, where employers' options are more limited.
A few questions:
- How did the researchers control for the effects of skyrocketing employment and economic growth in Seattle?
- What was the mean wage increase?
- What was the median wage increase?
- What was the distribution of wage increases? For instance, what percentage of food service workers received what level of wage increase?
- How many food service workers received raises as a result of the minimum wage hike?
- How many workers in non-tipped positions received raises? What percentage of non-tipped food service workers do they represent?
- Were the hours of food service workers reduced as a result of the minimum wage hike?
- Did employer hiring practices change as a result of the minimum wage hike? For instance, were employers less likely to give marginal job applicants a chance?
- Was there a relationship between how much employer wage rates increased due to the minimum wage hike and changes in employee hours or the number of employees?
Bottom line: we have no way to evaluate this study. Both the news articles and research brief leave out way too much relevant information. They read more like propaganda than sincere attempts to inform the public.
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* I believe the authors meant "2009 through 2016".
** The State of Washington does release annual reports on wages for hundreds of occupations. An enterprising reporter could have easily found this information for the years covered in the study. I looked at the 2016 report, which includes average hourly wage information for the Seattle area, such as: food servers/$12.77, cashiers/$13.73, food preparation workers/$13.32/hour, and fast food cook/$11.66. The state averages for these same positions aren't that much less than what is paid in Seattle (in most cases, less than a dollar an hour).