John Tsitrian reads an RCJ updated version of Bob Mercer’s report on South Dakota’s growing economy and notices what didn’t happen: South Dakota’s 17% increase in the minimum wage on January 1, 2015, hasn’t produced any of the economic drag Governor Dennis Daugaard and other opponents predicted.
My guess is that Daugaard was swayed by the siren song of the South Dakota Retailers Association (of which I’m a member in good standing) which forecast ominous results stemming from a minimum wage increase. SDRA fought the issue with everything it had, even sending a spokesman from Pierre to Rapid City to weigh in against the measure at a public forum. SDRA blanketed the state with an ad campaign that predicted a higher minimum wage would “trigger higher prices, layoffs, cuts in hours for workers, and delays in making needed improvements.” No doubt there were some spot instances where some or all of those eventualities occurred, but its clear from year end summaries that South Dakota’s economy moved forward nicely in the aggregate. The opposition to the wage hike had it all wrong [John Tsitrian, “SD Minimum Wage Goes Up, Economy Responds Favorably, Naysayers Repudiated,” The Constant Commoner, 2016.01.05]
South Dakota’s minimum wage—now $8.55 with this year’s cost-of-living adjustment—has shown no sign of interfering with job growth. Tsitrian contends it’s more likely that paying more to workers at the bottom of the heap has actually helped the economy by giving more workers more money to spend.
During last year’s debate over the youth minimum wage (you know, David Novstrup‘s kid-hating, worker-hating, democracy-hating bill that we get to kill at the polls come November), I recall some observers suggesting we would see similar legislation this year attacking the minimum wage on another front, such as a revival of a toothier version of Rep. Jim Bolin’s assault on the cost-of-living adjustment). Perhaps those legislators should pause, look at the data, and realize they don’t have an economic leg to stand on if they try attacking South Dakota’s minimum wage.