What will be the result of Seattle's new tax on companies that make over 20 Million a year?

Their 15 dollar minimum wage pushed small businesses outside the city limits and resulted in workers making less money as their hours were cut. This new tax is a head-tax for every worker the company has that works within the city limits.

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Northwest · M

Their 15 dollar minimum wage pushed small businesses outside the city limits

No. Two studies, done by the U of Washington and UC Berkeley, showed that jobs did not migrate. It's even illogical to suggest this would be the case, as most of these jobs are in the service industry, such as restaurants and retail (clothes, etc.).

Are you suggesting that Canlis restaurant is going to move, from its current location to Bellevue?

and resulted in workers making less money as their hours were cut.

Did you read the studies? They were published in June 2017, showing that the employees who were affected, made 9% less, as some of their hours were cut. That's not the full story though. It turns out that the study did not consider some other factors, like decisions these employers had already made, regarding their labor force, in response to how another major Seattle business, affected their business: specifically Amazon.

This new tax is a head-tax for every worker the company has that works within the city limits.

This issue was discussed a few days ago. The claim was that Amazon shut down construction. I was poo-pooed, when I said that this was a PR move.

The city council voted on a compromise, and the head tax will be about half what was initially proposed. Even before the vote was ratified by the Mayor, Amazon had quietly resumed construction on the building.

SuicideBiProxy2 · 36-40, M

@Northwest You mean after the city council shopped for a study that matched their intentions? Note this was done before the plan was fully enacted. Amazon will continue to build, however they will also slow growth in the city as they will hire on at other locations and their future 2nd HQ. There were a number of small businesses that shut down due to the 15 dollar minimum wage, most in the service industry.

Northwest · M

@SuicideBiProxy2 City shopped for studies? Huh?

Perhaps you can share the names of some of the businesses that moved.

The reason Amazon is looking for another headquarters, is that the area is near max capacity at all levels. Infrastructure, engineers, etc. Amazon has thousands of job openings it cannot fill. Same with Microsoft, Starbucks, Costco....

SuicideBiProxy2 · 36-40, M

@Northwest Indeed. Now with a headcount tax, they will simply fill those positions in other locations and depending on the economic consequences to their bottom line, they will shift people to other locations. To pretend this is going to have no effect is absurd.

The company I recall was a restaurant. Most companies reduced workforce and cut hours.

Northwest · M

@SuicideBiProxy2 This does not answer my question. You said that the city shopped for studies, so what are those studies?

Amazon's statement:

We are disappointed by today’s city council decision to introduce a tax on jobs. While we have resumed construction planning for Block 18, we remain very apprehensive about the future created by the council’s hostile approach and rhetoric toward larger businesses, which forces us to question our growth here. City of Seattle revenues have grown dramatically from $2.8 billion in 2010 to $4.2 billion in 2017, and they will be even higher in 2018. This revenue increase far outpaces the Seattle population increase over the same time period. The city does not have a revenue problem — it has a spending efficiency problem. We are highly uncertain whether the city council’s anti-business positions or its spending inefficiency will change for the better.

It's back to the near daily rhetoric between the City and Amazon. "question growth here" is somewhat gratuitous, is not quite the secret is it? they already know there's no more room for growth in Seattle. The entire South Lake Union area is Amazon. This is why they're looking for a 2nd headquarters outside of the Seattle area. Duh.

What the statement does not mention, is the disagreement is over how the city should spend the money on the homeless.

The same with Starbucks, it's not about the tax itself, it's about how the city plans on spending it. The Starbucks statement:

This City continues to spend without reforming and fail without accountability, while ignoring the plight of hundreds of children sleeping outside. If they cannot provide a warm meal and safe bed to a five year-old child, no one believes they will be able to make housing affordable or address opiate addiction. This City pays more attention to the desires of the owners of illegally parked RVs than families seeking emergency shelter

To pretend this is going to have no effect is absurd.

The head tax is but one issue affecting job growth within the city of Seattle. Everything has an effect, and to claim I said it has no effect, is truly absurd, it's just not the effect you claim.

Still waiting for the names of those businesses that moved, solely due to the raise in minimum wage.