Deal reached at the ports, but normalcy may be a long way off

On Friday, the Pacific Maritime Association and the International Longshore and Warehouse Union came to an agreement on a new contract, averting a full shutdown of West Coast ports. A major slowdown had been ongoing for the past several months, which we have written about previously. According to the Los Angeles Times,

The agreement, which still needs approval from union members and individual employers, should start easing severe congestion that’s been building for months at the nation’s busiest ports, in Los Angeles and Long Beach, along with other major gateways.

Details of the proposed five-year contract for about 20,000 West Coast dockworkers were not released. The dockworkers have been without a contract since July. The two sides had been negotiating since May.

The dispute caused businesses across the nation to lose money because imports were trapped on boats and exports trapped on land.

“We heard from small-business owners, large-business owners, farmers who couldn’t get their produce or their meat to market,” U.S. Labor Secretary Thomas Perez told reporters in San Francisco, where he joined contract talks this week to push for a settlement.

“This is now in the rear-view mirror,” Perez said. “A significant potential head wind for this economic recovery has been removed.”

When will things be back to normal? According to the Ports of Seattle and Tacoma,

Operations at our terminals resumed Saturday evening. We are uncertain how long it will take to move the remaining cargo on our docks and awaiting vessels, and to assess the effects this has had on our gateway.

The Seattle Times notes that

It will take six to eight weeks for West Coast ports to recover from the cargo backlog, according to the Port of Oakland and the National Retail Federation, which represents stores that resorted to stockpiling seasonal merchandise in warehouses and shifting to East and Gulf Coast ports. The backlog swelled as the two sides quarreled over a new deal.

KUOW has a good interview on the impacts of the slowdown, including the importance of the ports to keeping Seattle and Tacoma competitive.

Latest In Focus episode

 

Above is the latest episode of our In Focus podcast. Lew and Kriss talk about:

Policy Today episode on transportation

 

Above is the latest episode of our Policy Today podcast (recorded February 16). Lew and Kriss talk about the transportation package proposed in the Legislature.

New report: The Long-Lasting, Negative Consequences of the Minimum Wage

We have a new report today: The Long-Lasting, Negative Consequences of the Minimum Wage. Briefly:

  • High labor costs hurt a state’s economic competitiveness.
  • In Washington, these costs include the nation’s highest minimum wage.
  • Unlike the federal minimum wage, Washington’s is indexed to inflation and has no tip credit.
  • HB 1355 would increase Washington’s minimum wage to $12 in 2019.
  • 3.03 percent of Washington’s FTE jobs were at the minimum wage in 2012.
  • Nationally, workers under 25 are about half of those paid the federal minimum wage.
  • Minimum wage increases have long-lasting, negative effects on workers.
  • Minimum wages reduce employment for those with fewer skills.
  • For each 10 percent increase in the minimum wage, about one-sixth fewer jobs are created.
  • Higher minimum wages reduce the earnings of the lowest-skilled.
  • Minimum wages do not reduce poverty.
  • Minimum wages limit human capital acquisition.
  • Minimum wages reduce consumer, employee, and employer choices.

We also talked about the minimum wage on the podcast — see here for the episode.

At end of open enrollment, Exchange goals were not met

Open enrollment for health insurance ended Sunday. The Washington Health Benefit Exchange (HBE) has only provided approximate enrollment numbers: “Nearly” 160,000 renewed coverage or enrolled for the first time during the open enrollment period. Of those, “more than” 66,000 were new enrollees, meaning that renewals were not more than 94,000.

They did get a bounce in enrollments during February (in the chart, the enrollments reported Feb. 16 are for 15 days only, while those reported Feb. 5 are for the entire month of January). But the HBE made only about 77.6 percent of its goal for new enrollees (85,000) and about 72.3 percent of its goal for renewals (130,000). This has implications for its budget, which depends partially on a tax on plans bought through the Exchange.

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As the Seattle Times points out, after open enrollment last year, 164,000 had purchased insurance through the Exchange. One reason they may not have matched that number is affordability:

The amount available in tax subsidies is pegged to the price of the second-cheapest silver plan sold in a customer’s geographic area. That price decreased across Washington, so the subsidies shrank, too. The precise amount a person receives is determined by his or her income.

Monthly premiums for exchange plans rose a modest 2 percent for 2015. But insurance prices also go up each year according to a customer’s age.

Despite the exchange’s better showing last year, it appears that costs were a struggle then as well. Slightly more than half of the exchange customers missed at least one month’s payment last year. And by the end of December, roughly 44,000 had outstanding balances on their accounts.

Podcast: Minimum Wage

 

In today’s episode of Policy Today, Lew, Kriss and I talk about Washington’s minimum wage, which is the highest in the nation. A special report on the topic is coming soon.

Update: Here’s the link to our report — The Long-Lasting, Negative Consequences of the Minimum Wage

New In Focus episode

 

Above is a new episode of our In Focus podcast. (Yesterday we posted another episode.) Below are some links relevant to our conversation.

Podcast: In Focus

 

The latest episode of our In Focus podcast is above. In it, Lew, Kriss and I talk current events.

Some relevant links:

Remainders: liquor, apples, jobs

As we wrap up the week, here are some items of interest:

  • The Office of Financial Management released a paper on the impacts of I-1183 (liquor privatization). Sample line from the report: “Thus, pre-privatization, the LCB mission was achieved: to induce and maintain a liquor market characterized by allocative inefficiency, inhibiting full market demand.”
  • Jon Talton on UW President Michael Young moving to Texas A&M: “Young was said to be impressed by the willingness of Texas lawmakers to invest in higher education.”
  • NPR has a map showing the most common job in each state from 1978 to 2014. Watch as Washington’s most common job moves from secretary to software developer.

Washington Exchange enrollment through January

The Washington Health Benefit Exchange (HBE) has released some enrollment numbers through January. I say “some” because they only include numbers for new and renewed qualified (private) health plans (QHP) and for new Medicaid enrollees under the expansion. They do not include numbers for Medicaid renewals or enrollments in Medicaid by those who were previously eligible for Medicaid but had not enrolled. They also do not provide updated numbers for business enrollees.

The chart below shows the QHP enrollments per report for this open enrollment period. Through January, 44,779 have newly enrolled in a QHP and 87,528 have renewed their coverage in a QHP.

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According to the HBE press release,

Current enrollment data shows that a larger percentage of residents are qualifying for Washington Apple Health (Medicaid) than previously expected.

“We have seen more than 630,000 individuals newly covered in Washington State, which is well beyond our combined 2015 enrollment forecasts for Qualified Health Plans and Washington Apple Health,” said [HBE CEO Richard] Onizuka. “While residents continue to qualify for Apple Health, we expect a large enrollment surge in new and renewing private health plan enrollment heading toward the Feb. 15 deadline.”

The 630,000 includes Medicaid enrollees; the numbers for QHP enrollees do not reach the goal the HBE had for this enrollment period, which is for 85,000 new enrollees in a QHP and 130,000 QHP renewals. The Seattle Times notes that the insurance commissioner is less optimistic than the HBE CEO:

“I’m not exactly encouraged with the enrollment numbers we’re seeing right now,” said state insurance commissioner Mike Kreidler. “There might be a mad rush at the end.”