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Seattle’s Sky-High Minimum Wage for Delivery Drivers Has Been a Disaster

Recently, a new type of work has emerged: app-based work.

These include jobs like dog walking in Rover, Taskrabbit work, DoorDash food delivery, Uber and Lyft driving.

A lot of people like gig work. It is flexible. You work when you want to work.

But “workers’ rights” activists and the ruling socialists don’t like it. Factory workers rarely join unions. They don’t get minimum wage.

“Uber and Lyft exploit their workers” title on MS NOW. “We can’t ignore this.”

The Democratic Socialists said they had found a solution. Seattle city council set a $26 minimum wage for delivery drivers.

What could go wrong?

Two years later, we know the answer: Gig workers I don’t make any more money but prices have increased.

Apps like DoorDash and Uber Eats $5 fee for consumers “to help defray the costs of these regulations.”

Now Seattleites are complaining about prices. “I ordered a $12 sandwich… $12 turned out to be $32!” Someone inside me is complaining. new video. “I just deleted the app.”

“[Work] an app driver slowed down due to new law,” complains DoorDash there is 1.7 million fewer Seattle orders in 2024.

This is what happens when politicians dictate wages.

“Obviously, when you increase costs to businesses, you’re going to increase costs to customers,” says economics professor Judge Glock. “These are unimaginably complex markets where the company’s core business is to interface restaurants. And delivery workers And customers. “Then an economically illiterate city council or mayor thinks they can appropriately regulate full pay by looking at an industry, basically by reading the news.”

Former Seattle City Council President Sara Nelson confesses politicians made mistakes: “We created a problem and it’s our responsibility to fix it.”

Did they repeal the damaging law?

NO.

Nelson said they just needed to change the numbers: “If we had gotten the minimum wage standard right, we wouldn’t have seen the drop in income.”

What arrogance! Somehow, the political class knows exactly how much each worker should be paid.

Price controls never work.

Flexible pricing ensures this.

Competition forces businesses to constantly adjust wages and prices to attract workers and customers.

Glock says it’s “obviously ridiculous” for smug politicians to think they can set a “right” price. “There will be no improvement in people’s well-being and there will be no increase in the wages of these workers.”

A similar minimum wage increase failed in New York after politicians guaranteed app-based drivers around $20 an hour.

“The reduction in tips and increased competition for jobs offset any gains from the imposed minimum wage,” says Glock. “This is a constant whack-a-mole trend. The market responds like this: [so politicians] Pass new regulation to try to prevent this backlash. “They think the next regulation will somehow suppress greed in the system, but there’s no way to do that.”

Competition is the only good way to decide how much to pay people.

“Many politicians believe there is a free lunch or a fixed amount of money they can distribute to the neediest people.” Glock says. “The real impact was not to improve employee welfare but to increase costs for customers and sabotage one of the most successful businesses in the city.”

Post Too High Minimum Wage for Seattle’s Delivery Drivers Has Been a Disaster appeared for the first time reason.com.