The push for a $20 minimum wage in Tacoma has run into a legal roadblock. The organizers of Initiative 2, United Food and Commercial Workers Local 367, Tacoma for All and the Tacoma Democratic Socialists of America are suing Pierce County, the City of Tacoma and the Pierce County Auditor for missing a critical filing deadline. The Tacoma City Council on August 8 voted to send the initiative to the ballot in November but missed the filing deadline by 3 days. This means the initiative will not be on the ballot this fall.
The initiative sponsors are alleging Pierce Counties’ rejection of the initiative is a result of the county not completing the process in time for the deadline.
The Tacoma $20 initiative is one of many efforts to raise the minimum wage across the state of Washington.
Small businesses, particularly in retail, food service, and hospitality, face severe financial strain when mandated minimum wage increases occur. The initiative, which proposes raising Tacoma’s minimum wage from $16.66 to $20 per hour, would significantly increase labor costs. For a small business with 10 employees, this could mean an additional $70,000 or more annually, assuming a 40-hour workweek. Many small businesses operate on thin margins and lack the revenue to absorb such costs without raising prices, cutting hours, or reducing staff. A 2017 University of Washington study on Seattle’s wage increases found that low-wage workers lost an average of $125 per month due to reduced hours, a cautionary tale for Tacoma.
The push for a $20 minimum wage will accelerate automation, especially in industries like grocery and fast food. Businesses facing higher labor costs often turn to technology to reduce staffing needs. Tacoma businesses have already begun investing in automation to offset existing wage pressures. A 2023 National Bureau of Economic Research study showed that California lost 18,000 jobs as a result of an increase in the minimum wage in 2023 to $20. In Tacoma, this will mean fewer entry-level jobs for young or inexperienced workers, limiting their ability to gain critical work experience.
Consumers would also feel the impact. Higher wages translate to higher prices for goods and services. In Tacoma, where the cost of living is already a concern, increased prices will disproportionately burden low-income residents who rely on affordable dining, groceries, and retail. The initiative’s phased approach for smaller businesses, $18 for medium-sized employers and $17 for those with 15 or fewer employees, may delay but not eliminate these pressures.
Tacoma’s economic diversity demands flexibility. Tacoma’s moderate economy will not support a $20 minimum wage without causing job losses or business closures. The initiative’s one-size-fits-all approach ignores local market, income driven demand, risking economic disruption in less affluent areas.
The lawsuit reflects frustration with bureaucratic delays, but the underlying policy remains flawed. A $20 minimum wage could lead to higher prices, fewer jobs, and increased automation, undermining the very workers it aims to help. Instead, policymakers should explore targeted solutions like tax incentives or job training to support workers without destabilizing Tacoma’s economy.
