On October 4, 2005, the voters in Albuquerque narrowly defeated a city-wide minimum wage ordinance that would have applied to all businesses with eleven or more employees. The so-called living wage level would have been $7.50 an hour, a 45% increase in the wage floor; the new wage floor would have been indexed to inflation. The election result was 49.12% of voters in favor, and 50.88% of voters opposed to such an ordinance, and the margin of defeat was less than 1,500 votes.
I recently released a study on the short-term effects of the Santa Fe living wage. I found that Albuquerque’s neighbor suffered an increase in the unemployment rate due to the Santa Fe living wage ordinance (currently $8.50, scheduled to increase to $10.50 by 2008), and that workers who kept their jobs had their hours reduced. The effects were very strong for those with twelve or fewer years of education, and there was virtually no effect for those with higher levels of education.
A number of newspapers, in Santa Fe, Albuquerque, and elsewhere, took notice of my study in the past few weeks:
Study: Wage Law Leads to Job Losses
540 Jobs Lost in First Year of Santa Fe's Minimum Wage Hike
Study: 540 Jobs Lost Due To Wage Increase In Santa Fe
‘Living wage’ issue raises questions, brows
Studies differ on effects of ordinance on unemployment
Santa Fe Wage Foes Cite Figures
Santa Fe Reporter cover story: The Earn Burn by Dan Frosch
I certainly have concerns with how my study was characterized in some of the above articles, but fortunately the majority of voters in Albuquerque learned a lesson from Santa Fe’s experience.