Jonathan Miltimore of the Foundation for Economic Education said on May 11 that Seattle politicians chose to ‘abandon sound free-market policies in favor of coercive wage controls.’ The statement addresses outcomes from Seattle’s App-Based Worker Minimum Payment Ordinance for food delivery drivers and relates to broader effects on local labor markets and consumer costs.
The ordinance, known as PayUp, sets minimum compensation for drivers at 74 cents per mile and 44 cents per minute or five dollars per order. Miltimore published the statement in an article on the Foundation for Economic Education website, examining the law passed by the Seattle City Council according to the Foundation for Economic Education.
Seattle businesses reported sharp declines in third-party delivery sales following the ordinance’s implementation, according to local accounts from restaurant owners. One café operator observed nearly half of the delivery app volume disappear while drivers described waiting hours for single requests and reduced overall earnings opportunities. Delivery platforms responded by adding flat fees to customer orders to cover the new requirements, which affected order volumes across the city according to a report by Puget Sound Business Journal.
Miltimore said, ‘Price and wage controls have been failing for thousands of years, but this has not stopped kings, emperors, and democratically elected rulers from imposing them. While some workers may benefit from a minimum wage law, others will be harmed by it because the value they bring is below the artificially high cost of their labor. Employers often respond to wage floors by hiring fewer workers, reducing employee hours, and nixing other forms of worker remuneration. Unfortunately, workers, businesses, and consumers are all paying the price because Seattle politicians chose to abandon sound free-market policies in favor of coercive wage controls.’
A University of California, Berkeley study from 2020 found that a 10 percent minimum wage increase correlates with a 0.36 percent rise in grocery prices. Cornell University research in 2018 similarly showed that in many cases, nearly all added labor costs from wage mandates pass directly to consumers through higher prices rather than being absorbed by employers. These patterns appear in various local markets where such policies apply according to academic studies. A 2018 Cornell University study examined wage floor impacts across multiple sectors and confirmed that price pass-through rates often reach near 100% for consumer-facing industries. Similar national data sets indicate that mandated pay changes frequently lead to adjustments in hours worked or service availability to maintain business viability according to Cornell University research.
Miltimore is a writer and former senior creative strategist at the Foundation for Economic Education. His work has appeared in outlets including Newsweek and The Washington Times, and he previously worked as a reporter for the Panama City News Herald according to his biography.
