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  5. LERA Best Papers III: Minimum Wage
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LERA Best Papers III: Minimum Wage

Paper Session

Friday, Jan. 7, 2022 3:45 PM - 5:45 PM (EST)

Hosted By: Labor and Employment Relations Association
  • Chair: Samuel L. Myers Jr., University of Minnesota-Twin Cities

The Devil Is in the Details: Sub-minimum Provisions of Local Minimum Wage Laws

Jaime Lancaster
,
Humboldt State University

Abstract

This paper uses data from the Current Population Survey (CPS) and the American Community Survey (ACS) to explore the effects of the Albuquerque/Bernalillo minimum wage laws of 2013 on the teen and food-service labour markets in New Mexico. Results from fixed effects and synthetic control estimation indicate that firms adapted to the higher minimum wage laws by both raising wages and increasing their reliance on the sub-minimum wage provision of the ordinances. By increasing reliance on the sub-minimum wage provision of the laws, firms reduced hourly wages paid to workers who customarily earn tips. This response undermined the ability of the minimum wage to raise earnings for low paid workers who rely on tips. Results suggest that sub-minimum wage provisions can offset potential gains to workers, an issue relevant to lawmakers when crafting minimum wage legislation.

First to $15: Alberta's Minimum Wage Policy on Employment by Wages, Ages, and Places

Sebastian Fossati
,
University of Alberta
Joseph Marchand
,
University of Alberta

Abstract

Alberta is the first North American state or province with a $15 minimum wage, with an unexpectedly large increase (47%) over a short time span (3 years). The employment effects of this policy are estimated using a synthetic control approach on Labour Force Survey data. Three empirical results are documented. First, employers complied with the minimum wage increases, increment by increment, with workers moving up the wage distribution, bin by bin. Second, employment losses were found among young workers, but not among prime-age and older. Third, employment losses were found outside of Alberta's two main cities, but not within them.

Workplace Amenities and the Minimum Wage

Jason Sockin
,
University of Pennsylvania

Abstract

Workplace Amenities and the Minimum Wage

Early Effects on a Local Minimum Wage Policy on Low-Wage Worker Health

Caitlin Caspi
,
University of Connecticut

Abstract

Minimum wage laws are a promising policy lever to promote health equity, but few rigorous evaluations have tested whether and how minimum wage policy affects health outcomes. We present the midpoint results of an ongoing natural experiment evaluating the health effects of the 2017 Minneapolis Minimum Wage Ordinance, which incrementally increases the minimum wage to $15/hr. The larger prospective study follows a cohort of 969 low-wage workers in two cities (Minneapolis, Minnesota, and Raleigh, North Carolina, the comparison community) over five years (2018-2022). This difference-in-difference analysis uses data from three annual visits collected from 2018 to 2020. We present trends in the two cities in employment-related variables (hourly wage, hours worked, unemployment), body mass index, and relevant health-related mediators (food insecurity, participation in federal food assistance programs, and diet quality) and discuss results in the context of the COVID-19 pandemic. This interim analysis contributes to the discussion of early effects of local minimum wage polices and the potential health effects of such policies.

Discussant(s)
Elena Falcettoni
,
Federal Reserve Board
Teresa Kroeger
,
Brandeis University
Aaron J. Sojourner
,
University of Minnesota
Thomas Durfee
,
University of Minnesota
JEL Classifications
  • J3 - Wages, Compensation, and Labor Costs