Economist: Higher Arizona Minimum Wage Hasn't Affected State Economy — Yet

Published: Tuesday, January 2, 2018 - 2:51pm
Updated: Wednesday, January 31, 2018 - 4:11pm
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(Photo by Jackie Hai - KJZZ)
Ethan Clay
Supported by Beach Fleischman

Minimum wage workers in Arizona got a raise Monday, of 50 cents an hour. The state’s minimum wage now stands at $10.50 an hour. It’s part of a voter-approved increase, which will ultimately reach $12 an hour by 2020.

Last year was the first year of that increase, and Ethan Clay, an economic policy analyst with the Arizona Center for Economic Progress, said it’s been a big positive for workers.

"Despite there’s been strong job growth over the last few years, wage growth has been pretty stagnant, it’s been very stubborn," Clay said. "That’s especially true for lower-income individuals. And so, if someone has been working for the last two years, full time, year-round, making the minimum wage, in 2017, they had $4,000 more in their pockets at the end of the year."

According to state data, restaurants and bars employed 12,000 more people in November than the same month last year.

But Steve Chucri, president of the Arizona Restaurant Association, said even though restaurants are opening and hiring, not everything’s great in the industry.

"In my 15 years of running this association, I have never seen an impact to the bottom line of restaurateurs like this new increase, and the paid-time off has had in year one of this new law taking effect," Chucri said.

To get a sense of how the state’s new minimum wage impacted Arizona’s economy last year, I’m joined by economist Jim Rounds of Rounds Consulting.

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