Higher Minimum Wage: Good Or Bad For The Economy?

Relay Robot will assist guests at RAR Hospitality's Fairfield Inn in San Marcos
Relay Robot Will Assist Guests At Rar Hospitality's Fairfield Inn In San Marcos

A ballot initiative to raise San Diego’s minimum wage in 2016 from $10.50 to $11.50 provided a test case for upward movement of the minimum wage throughout California this year to $11.50 — and $15 by 2023. There is some evidence the higher minimum wage has stifled job growth for some low-wage workers, while boosting wages for thousands of others.

A report from the U.S. Bureau of Labor Statistics found a year-over-year drop in food-service job growth, which fell from 6.6% growth to a 0.3% decline by February 2017, which translates to 4,000 food-service jobs either not created or eliminated, the San Diego Union-Tribune reports. Robots are expected to eliminate even more minimum-wage jobs in the near future, with McDonald’s rolling out self-ordering kiosks, Starbucks testing an automated barista, and one company promising a robotic arm called “Flippy” that cooks and flips burgers.

In San Diego County, unemployment dropped from 4.5% in January to 4.2% in February, according to a California Employment Development Department report, and down from 4.8% a year ago. After adjusting for seasonal variation, the rate was 4.1%. The local labor market was stronger than the rest of the state (5%) or nation (4.7%), with employers adding 6,600 jobs in the first two months of the year and 26,700 jobs over the last 12 months.

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