Guess which states lost retail jobs while hiring overall increased?

The title contains the entire quiz presented this week by We’ve seen a slower than desired, but relatively steady increase in hiring for a number of months now. (Not counting the underemployed and those out of the work force, of course, but still an improvement.) It’s not situational in nature, having spread across most of the country. One thing to note is the unfortunate tendency for these new jobs to be lower wage, retail positions, replacing higher skill, higher paying manufacturing jobs. Still, having a paycheck is better than nothing.

But there are three states where even these retail jobs have been in shorter supply. The first one is probably fairly obvious to any of you who follow this site regularly. North Dakota has seen a drastic cut in energy production jobs due to sustained low oil prices and it’s dragging down every other sector with it. But the other two may not be as intuitive.

It’s probably no coincidence that Connecticut and Massachusetts, the first two states to approve hikes in their statewide minimum wage to north of $10 an hour, now stand out because of retail-employment contractions.

Massachusetts has lost 2,200 retail jobs since employment in the sector peaked last July, seasonally adjusted Labor Department data show. Retail employment is down 500 from December 2014, before the first step of the state’s wage hike went into effect.

The minimum wage rose from $8 to $9 at the start of 2015 and to $10 on the first day of 2016. It’s slated to go to $11 in 2017.

Oddly enough (by which I mean, not oddly at all) the rest of the Bay State hasn’t been doing that badly, experiencing recovery at the same relatively tepid pace as the rest of the nation. But in minimum to low end wage positions, the job market has tailed off. Employers, as usual, find another way to scale their business when labor costs outstrip profit margins.

Connecticut turned out to be largely the same.

The state first hiked its minimum from $8.25 to $8.70 at the start of 2014, then became the first to embrace President Obama’s call for a $10.10 wage. The current minimum wage of $9.60 will hit $10.10 at the start of 2017.

Now retail employment in Connecticut is down 1,400 from a peak of 185,000 first hit in April 2014, and the state has fewer retail jobs than it did 30 months ago.

If you’ve been following this saga at IBD, they posted warnings from economists back in 2014 that a sudden spike in the minimum wage would cost as many as half a million jobs in relatively short order. Now there may be little choice but to pay attention.

When you first began reading this article I’m willing to bet that some of you thought one of the states on the list would be Washington. Not so… at least not yet. The entire state has yet to embrace the same policies as the city of Seattle, which have been sinking businesses in a steady fashion as employers cut back on staffing or move outside the city limits. There are other industry sectors, particularly along the coast, which have been recovering and balancing things out. But sooner or later the piper will show up demanding his pay. Just don’t act surprised when it happens, and you can ask the Fight for 15 folks to explain it to the newly unemployed.


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Jazz Shaw 7:31 PM on October 02, 2022