Effects of the minimum wage on employment dynamics

Arbeitspapier

The voluminous literature on minimum wages offers little consensus on the extent to which a wage floor impacts employment. We argue that the minimum wage will impact employment over time, through changes in growth rather than an immediate drop in relative employment levels. We conduct simulations showing that commonly-used specifications in this literature, especially those that include state-specific time trends, will not accurately capture these effects. Using three separate state panels of administrative employment data, we find that the minimum wage reduces job growth over a period of several years. These effects are most pronounced for younger workers and in industries with a higher proportion of low-wage workers.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Upjohn Institute Working Paper ; No. 15-233

Classification and Topics

• Classification: Wirtschaft ; Wage Level and Structure; Wage Differentials ; Wages, Compensation, and Labor Costs: Public Policy ; Labor Turnover; Vacancies; Layoffs
• Subject: minimum wage ; employment growth ; administrative data ; low-wage workers

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Meer, Jonathan ; West, Jeremy
• Event: Veröffentlichung
• (who): W.E. Upjohn Institute for Employment Research
• (where): Kalamazoo, MI
• (when): 2015

Further information

• DOI: doi:10.17848/wp15-233
• Handle: http://hdl.handle.net/10419/126285
• Last update: 10.03.2025, 11:42 AM CET