A proposal on the November ballot in SeaTac would establish a $15 minimum wage and paid sick leave benefits, and impose restrictions on employers’ labor practices. In a new special report, we consider the economic effects of Proposition 1. Our five main findings are:

1. Approximately 5 percent of low wage jobs will be lost. Another 5-10 percent of affected workers will be replaced by more experienced and educated employees.
2. Business not subject to Prop.1 will feel pressure to increase compensation.
3. Tax revenues will decline and, over time, grow more slowly than otherwise anticipated. Audit, oversight and enforcement provisions will increase city costs.
4. SeaTac residents represent fewer than 10 percent of the workforce covered by Prop. 1 and the city will receive no economic benefit from the higher compensation.
5. Prop. 1 imposes extraordinary compliance and equity challenges for all businesses, but especially those with substantial operations outside the city.