Hawaiʻi’s economy will benefit from a higher minimum wage

The majority of expert research finds that raising the minimum wage helps reduce poverty. The author of the opposition piece quotes from an out-of-date source, written in 2015, by an economist who has since walked that position back, publishing a new study showing that minimum wage increases are associated with reductions in poverty.

Here’s the truth: The minimum wage has been one of the most studied topics in economics for the past 25 years. Study after study finds that a higher minimum wage strengthens the economy and local businesses by raising the incomes of working families, putting more spending money in the pockets of customers. Significant data exists to show that raising the minimum wage also makes employees more productive and loyal, which saves small businesses money spent on turnover and training costs.

While our state’s minimum wage rose between 2015 and 2018, the unemployment rate dropped by 52 percent—to record lows—and restaurant server jobs have increased by 32 percent, despite warnings from the industry that the opposite would happen.

The evidence—from Hawaiʻi’s own experience—is clear: A higher minimum wage is good not just for workers, but for the local economy and businesses. It’s time for Hawaiʻi to raise the wage to a living wage.