NPR: Raising minimum wage increases restaurant health violations 6.3% for every $1/hr

Extrapolating this looks sound, because when you get Venezuelan hyperinflation to "boost" wages, then general public health deteriorates.

Clearly there are economic forces that support paying workers as little as possible. We wouldn't have slavery otherwise.

webby wrote:

Clearly there are economic forces that support paying workers as little as possible. We wouldn't have slavery otherwise.

Is this a joke?

Why do you ask if it's a joke? Paying workers little or nothing means that capitalists prosper and often provide as good or better services to the general public at competitive prices. Bad for workers/slaves, good for customers in some ways. Bad for society.

Isn't this the whole idea of Wal-Mart?

Damn liberal NPR

CoachB wrote:

Damn liberal NPR

Note that the interview, while music to the ears of those who oppose raising the minimum wage, only makes one policy recommendation: "one implication is if cities are going to raise the minimum wage, one thing they might want to do is step up inspections of these more minor violations because you can expect that businesses that face higher costs might sometimes seek to cut corners."

Also, if you read the full study, you'll see that there was no significant increase in "serious" violations -- only minor violations that are unlikely to have health consequences. So what the study really says probably doesn't deserve a headline:

"Higher minimum wage does not appear to increase serious health code violations, but minor violations increased from roughly 3.3 per restaurant per year to 3.5 per restaurant per year."

My much more reliable sources are reporting a 6.3141% increase.

Due to fewer hires and/or smaller staff?

There are negative outcomes from higher minimum wages. Do these outweigh the benefits?

Some employers are trying to cut corners, and they are getting nailed (yay big government!). Not surprising.

webby wrote:

CoachB wrote:

Damn liberal NPR

Note that the interview, while music to the ears of those who oppose raising the minimum wage, only makes one policy recommendation: "one implication is if cities are going to raise the minimum wage, one thing they might want to do is step up inspections of these more minor violations because you can expect that businesses that face higher costs might sometimes seek to cut corners."

Also, if you read the full study, you'll see that there was no significant increase in "serious" violations -- only minor violations that are unlikely to have health consequences. So what the study really says probably doesn't deserve a headline:

"Higher minimum wage does not appear to increase serious health code violations, but minor violations increased from roughly 3.3 per restaurant per year to 3.5 per restaurant per year."

If there are regulations that don't protect the public health but increase costs, maybe we should eliminate those regulations.

D3 scrub wrote:

There are negative outcomes from higher minimum wages. Do these outweigh the benefits?

great post. Life is about trade offs . In political discussions , older people are willing to admit that. What the op fails to understand is that the rise and minor violations from 3.3 to 3.5 per restaurant is probably most definitely worth it considering the added benefit to the workers if that was the only negative.

D3 scrub wrote:

There are negative outcomes from higher minimum wages. Do these outweigh the benefits?

Yes, since it hasn't actually done anything to fight poverty here

rojo wrote:

D3 scrub wrote:

There are negative outcomes from higher minimum wages. Do these outweigh the benefits?

great post. Life is about trade offs . In political discussions , older people are willing to admit that. What the op fails to understand is that the rise and minor violations from 3.3 to 3.5 per restaurant is probably most definitely worth it considering the added benefit to the workers if that was the only negative.

The people being paid a higher minimum are taxed on that, and they will spend almost every penny of it. So there is a marginal gain to the economy.

The increased cost in terms of dirtier restaurants can be paid for through fines and more enforcement.

A rise in minimum wage is an indirect tax on consumers - there is no disputing this. +90% of these consumers can afford this tax unless the service/product in question is primarily for the poor.

SRIKANT DEVARAJ: We find that a dollar increase in minimum wage resulted in a 6.4 percent increase in overall health violations and 15.3 percent increase in less severe violations as a result of the increases.

Anyway, the original paper had a MUCH more dramatic effect (11.45% per 10 cents/hour).

Abstract

We assess the effects of rise in minimum wages on hygiene violation scores in food service establishments. Using a difference-in-difference analysis on hygiene rating of food establishments in Seattle [where minimum wage increased annually between 2010 and 2013] as the treated group and from New York City [minimum wage was constant] as the control group, we find an increase in real minimum wage by $0.10 increased total hygiene violation scores by 11.45 percent. Consistent with our theoretical model, an increase in minimum wage in Seattle has no influence in more severe (red) violations, and a significant increase in less severe (blue) violations. Our findings are consistent while using an alternate control group - Bellevue City, King County, located near Seattle.

See also the talk abstract from June 2016.

In fact, the main "news" in all this is how much they "toned down" the original data effect to make it more palatable to NPR listeners.

Hygiene study wrote:

[quote]Blue code violations constitute "things like — insect, rodents, animals, employee cleanliness and hygiene; toilet facilities — whether they were properly constructed, supplied and cleaned; the garbage has been properly disposed of,"

[quote]

If these are "minor", what exactly is a "major" violation?!

In the jurisdiction in question (Seattle):

Red critical violations

Red critical violations are food handling practices that, when not done properly, are most likely to lead to food-borne illnesses. These food handling practices include:

*) controlling temperature, such as cooking meats to the right temperature to kill food-borne disease germs, keeping food hot enough until it is served, and keeping food cold enough

*) cooling food properly, washing hands, and using utensils instead of bare hands on "ready to eat" food

*) storing food

*) serving practices

Blue critical violations

Blue critical violations are primarily maintenance and sanitation issues that are not likely to be the cause of a food-borne illness.

So conversely, if the minumum wage decreases by a dollar, then restaurant health violations will decrease by 6.3 per cent.

How low should the minimum wage go until there are 0 health regulation violations?

Red violations are also increased by 7.3%. The paper has two Table 5's (and a blank page between them) so I'm not sure what is up here.

The larger effect (11.45% per 10 cents) is only under a difference-in-difference accounting, with NYC rather than Bellevue.

Note that NYC does not have a blue/red split.

rojo wrote:

D3 scrub wrote:

There are negative outcomes from higher minimum wages. Do these outweigh the benefits?

great post. Life is about trade offs . In political discussions , older people are willing to admit that. What the op fails to understand is that the rise and minor violations from 3.3 to 3.5 per restaurant is probably most definitely worth it considering the added benefit to the workers if that was the only negative.

Not the only negative.

In LA County and California, they are implementing higher minimum wages.

Every time a bump kicks in, the people that were making $.50 MORE than minimum now want the bump as well.

You can see the pattern move up the pay scale.

We already employ fewer people than we did just a short time ago.

If we have to bump minimum to $15.00/hr, we would probably have to cut our staffing by half of what it had been.

So, now instead of getting say, $9.00/hr, 50 people are unemployed.