The Effect of a City-Level Minimum Wage Policy on Supermarket Food - PowerPoint PPT Presentation

The Effect of a City-Level Minimum Wage Policy on Supermarket Food Prices By Processing Category Presenter: James Buszkiewicz, MPH, Doctoral Student, University of Washington Co-Authors: Amanda Spoden, Jennifer Otten, Adam Drewnowski, Seattle Minimum Wage Team AcademyHealth’s Annual Research Meeting New Orleans, Louisiana Sunday, June 25 th , 2017

This presentation was supported by: This study was supported by grants from the Laura and John • Arnold Foundation (http://www.arnoldfoundation.org/grants/) and the City of Seattle (OCA 2014-04 AM03), both awarded to Dr. Vigdor. The funders had no role in study design, data collection and • analysis, decision to present, or preparation of the presentation. We have no conflicts of interest to disclose. •

Outline Discussion & Background Methods Results Conclusion Seattle’s Key findings Data Summary of minimum by location at collection findings wage a fixed time Food Key findings Food Explanation processing by location processing of findings categorization across time Strengths, Statistical Differences limitations, analysis by locations future studies

Background

Background > U.S. food system is the largest employer of MW workers. U.S. food system accounts for ~1/3 of the total share of low-wage workers – in the nation. > Pass-through effects. Higher labor costs = higher food prices? – > To date, no studies have explored the effects of local-level minimum wage policies on supermarket food prices in detail at a local level. Food-insecure and higher-income consumers à 90% do usual grocery – shopping at supermarket or supercenter (USDA ERS, 2015) Benner et al., UC Berkeley Food Labor Research Center, 2012

Food Processing: Cost and Health Impacts Processed foods Minimally processed 90% of the daily intake of added sugar Linked to obesity and other diet- related chronic Ultra-processed diseases

Food Processing: ‘Pass-through Effect’ Ultra-processed foods Minimally processed foods Washing Frying Washing 1 2 1 Bagging Flavoring 6 7 5 4 3 Small increase Large increase Photo credits : Washing: http://keystoneedge.com/images/Features/martinspotatochipsinc.jpg. Flavoring: https://encrypted-tbn0.gstatic.com/images?q=tbn:ANd9GcTnQ7oNhZgUoc5sLcf9Y81vyPa-7gYcn0otkPTaiMN9XtXQZrpu. Packaging: https://i.ytimg.com/vi/kZgVWKlL6t0/maxresdefault.jpg. Frying / Dehydrating: http://www.oregontastes.com/sites/sal/files/styles/story_gallery/public/story/gallery/f7a6d718333f232c93aeb7d684047ed1.jpg?itok=LO5RhLCJ

Research Aim To investigate whether the increase in minimum wage had a differential effect on supermarket food prices based on degree of processing in supermarkets affected and unaffected by the MWO.

Methods

Data Collection: Store Selection Gray – Affected Light gray – Unaffected 65% name these as primary • (Seattle Obesity Study I) Variability in market basket • cost The 6 chains represent 65% (50 • out of 78 individual Seattle stores) impacted by the ordinance.

Data Collection time points 1 year $15/hour phase- 1 month prior seasonal in of Seattle match to to policy minimum wage enactment follow-up 1 (Baseline) (Follow-up 2) MW= $9/47/hour at policy enactment 1 month post 2 year policy seasonal Initial phase-in of enactment $13/hour phase- match to Seattle minimum in of Seattle (Follow-up 1) follow-up 1 wage ($11/hour) minimum wage and 2 (Follow-up 3)

Data Collection: CPHN Market Basket Custom-designed market basket: 106 items • Based on CPI and Thrifty Food Plan market baskets • Commonly eaten and nutrient-rich foods • Each item assigned to food group to coincide with 2005 US • dietary guidelines categories Based on medium sizes, lowest price recorded (often store • brand) Monsivais, JADA, 2009;5(109); Drewnowski AJPH, 2012;102(8)

Excerpt of the CPHN Market Basket and prices, at baseline Supermarket Chain Brand Food Group Item Name 1 2 3 4 5 6 Bacon, sliced, per lb. (453.6 gm) $2.99 $1.99 $2.99 $1.99 $1.99 $1.99 Meats/Beans/ Protein Beef liver (price per pound/453.6 grams) $0.99 $0.99 $1.32 $1.32 $1.76 $1.76 Bread, white, pan, per lb. $1.29 $1.29 $1.29 $1.29 $1.29 $1.29 Cereals/ Grains Bread, whole wheat, pan, per lb. $1.29 $0.79 $1.29 $0.79 $0.79 $0.79 Apples, Red Delicious, per lb. $1.18 $1.18 $1.18 $1.18 $1.18 $1.18 Fruits Bananas, per lb. $1.29 $1.29 $1.29 $1.29 $1.29 $1.29 Butter, salted, grade AA, stick, per lb. $1.79 $1.29 $2.05 $1.47 $2.34 $1.68 Dairy Cheese, American processed, per lb. $1.79 $0.99 $2.05 $1.13 $2.34 $1.29 Asparagus, bunch $1.99 $1.99 $1.99 $1.99 $1.99 $1.99 Vegetables Bok choy, fresh $0.99 $0.39 $0.99 $0.39 $0.39 $0.39 Margarine, soft, tubs, per lb. $2.19 $1.99 $2.19 $1.99 $1.99 $1.99 Sugars Sweets/Fats/ Oils Margarine, stick, per lb. $0.99 $0.79 $0.99 $0.79 $0.79 $0.79 Coffee, 100%, ground roast $1.79 $1.79 $1.79 $1.79 $1.79 $1.79 Other Beverages Malt beverages $1.99 $0.99 $1.99 $0.99 $0.99 $0.99

Food Processing Categories Food processing Market basket Defined as: category: examples: Foods taken directly from nature; minimally coffee, rice, milk, apples, Group 1: processed to clean, pasteurize, freeze, or frozen turkey, broccoli unprocessed or other processes that do not alter the (n=60) minimally processed composition foods Group 2: Ingredients that can be added to group 1 for flour, butter, shortening, flavor or seasoning used in the cooking sugar processed culinary process (n=7) ingredients Foods from group 1 that are minimally tofu, canned salmon, processed, often with salt or oil, with the canned corn, wine Group 3: intent of extending shelf-life or altering (n=12) processed foods palatability; includes fermented alcoholic beverages Foods that are highly processed with the cookies, ice cream, salad Group 4: intent of convenience and ready-to- dressing, sausages, cola, ultra-processed eat/drink potato chips foods (n=27) Martínez Steele, BMJ Open, 2016;6(3)

Analysis Package sizes • •Detect price Unpaired differences by standardized t-test location at a fixed time Excluded items not • consistent over time Paired t- Outcomes: Overall • test Market basket cost •Detect price Multi-level, (items summed), cost differences by linear mixed location by food group, cost by model across time processing category •Price change attributable to the MWO enactment

Results: Overall effect

Average market basket cost pre-, post-, and one-year following minimum wage law implementation in Seattle and King County

Average market basket cost pre-, post-, and one-year following minimum wage law implementation in Seattle and King County Difference-in-difference point estimate from Baseline to Follow- • up 1: -0.007 (SE=0.046, P=0.886 ). Difference-in-difference point estimate from Follow-up 1 to • Follow-up 2: -0.021 (SE=0.178, P=0.908 ). Difference-in-difference point estimate from Baseline to Follow- • up 2: -0.028 (SE=0.180, P=0.879 ).

Results: Key findings by location at fixed time

Market basket item prices by food processing category by store chain and location at baseline Baseline Group 1: unprocessed or minimally processed foods Group 2: processed culinary ingredients Group 3: processed foods Group 4: ultra-processed foods 1- K C $152.07 $53.90 $251.73 $15.2 8 $30.47 1 - Se a ttle $158.36 $52.92 $257.34 $13.5 8 $32.48 2 - K C $169.34 $59.43 $17.7 6 $23.90 $270.43 SUPERMARKET CHAIN 2 - Se a ttle $170.61 $55.34 $272.04 $18.8 2 $27.28 3 - K C $180.69 $59.47 $289.00 $19.6 7 $29.16 3 - Se a ttle $187.42 $60.21 $297.43 $18.4 6 $31.33 $302.23 4 - K C $190.95 $59.49 $22.5 4 $29.26 4 - Se a ttle $189.18 $58.87 $297.99 $21.4 9 $28.45 5 - K C $203.22 $76.05 $325.51 $17.7 3 $28.51 5 - Se a ttle $202.89 $80.27 $333.37 $19.8 3 $30.38 6 - K C $247.47 $115.38 $445.62 $36.4 1 $46.36 6 - Se a ttle $247.09 $113.54 $442.88 $35.6 1 $46.63 MARKET BASKET PRICE Baseline (mean) Group 1: unprocessed or -$1.77 to $6.73 minimally processed foods ($1.97) Group 2: processed -$1.71 to $2.10 culinary ingredients (-$0.27) -$0.81 to $3.38 Group 3: processed foods ($1.48) Group 4: ultra-processed -$4.09 to $4.23 foods (-$0.43)