Minimum-Wage Increases and Low-Wage Employment: Evidence from Seattle

Jardim, Ekaterina; Long, Mark C.; Plotnick, Robert D.; Inwegen, Emma van; Vigdor, Jacob L.; Wething, Hilary

doi:10.1257/pol.20180578

Cited by 28 publications

(24 citation statements)

References 60 publications

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“…Lachowska, Mas and Woodbury (2020a) use the data to decompose earnings after job displacement into hours and wages. Jardim et al (2021) examine the hours Washington is determined by the number of work hours a UI claimant has accumulated in roughly the year before a claim. 3 Questions have long been raised about the suitability of UI administrative earnings records for research.…”

Section: Introductionmentioning

confidence: 99%

“…225. Minimum wage changes and nominal wage distributions in the Washington dataSince 2001, the minimum wage in Washington has been indexed to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W)(Jardim et al, 2021; Washington State Department of Labor & Industries, 2018). It makes sense, then, to conduct a simple visual examination of whether the distribution of nominal hourly wages in the Washington data (quarterly earnings divided by quarterly hours) reflects annual changes in the Washington minimum wage.…”

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confidence: 99%

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How reliable are administrative reports of paid work hours?

Lachowska¹,

Mas²,

Woodbury³

2022

Labour Economics

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Section: Introductionmentioning

confidence: 99%

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confidence: 99%

How reliable are administrative reports of paid work hours?

Lachowska¹,

Mas²,

Woodbury³

2022

Labour Economics

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“…Our own analysis of published estimates for the restaurant industry finds an average elasticity of −0.1. This includes studies from the evaluation of city-wide minimum wage increases (Dube, Naidu, and Reich, 2007;Jardim, Long, Plotnick, Van Inwegen, Vigdor, and Wething, 2022).…”

Section: Introductionmentioning

confidence: 99%

“…An interpretation of our results is that the jobs elasticity is more negative when a higher minimum wage interacts with a recession. For example, the Seattle study by Jardim, Long, Plotnick, Van Inwegen, Vigdor, and Wething (2022) estimates an elasticity of −0.3 for restaurants. However, Seattle was booming during the implementation of their large minimum wage increase, whereas the Twin Cities were hit by a recession.…”

Section: Introductionmentioning

confidence: 99%

Minimum Wages and Labor Markets in the Twin Cities

Karabarbounis

Lise

Nath

2022

Preprint

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We bring new evidence on the labor market effects of large minimum wage increases by using merged administrative datasets from Minnesota to examine the policy changes implemented by Minneapolis and Saint Paul. We begin by using synthetic difference-in-differences methods to estimate counterfactual outcomes at the zip code level from Minnesota and at the city level from the rest of the country. The minimum wage did not affect employment in most industries but exerted a negative impact on restaurants' employment, with an elasticity of −0.8. Next, using variation in exposure to the minimum wage across establishments and workers within the Twin Cities, we find employment effects that are half as large as those from the time series. The cross-sectional estimates difference out employment effects from the pandemic or civil unrest that could confound the time series comparisons, but they do not include potential effects of the minimum wage operating through equilibrium adjustments such as entry. We quantify a model of establishment dynamics to reconcile the different estimates and argue that they plausibly reflect lower and upper bounds of employment losses. We use the model to show that our estimates are consistent with an establishment elasticity of labor demand of −1 and illustrate how they can inform deeper parameters characterizing product and labor market competition, factor substitution, and establishment dynamics.

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“…Our paper is also related to work studying the effects of local MW policies (e.g., Dube and Lindner 2021;Jardim et al 2022a), the effect of MW policies on commuting and migration (Cadena 2014;Monras 2019;Pérez Pérez 2021, e.g., ), and prices of consumption goods (Allegretto and Reich 2018;Leung 2021, e.g., ).…”

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confidence: 99%

From Workplace to Residence: The Spillover Effects of Minimum Wage Policies on Local Housing Markets

Borg¹,

Gentile²,

Hermo

2022

Preprint

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The recent rise of sub-national minimum wage (MW) policies in the US has resulted in significant dispersion of MW levels within metropolitan areas. In this paper, we study the effect of MW changes on local housing rental markets exploiting the placed-based nature of MW policies. For each location we define both the log MW where the average resident works (the “workplace MW”) and the log MW in the location itself (the “residence MW”). We derive a partial-equilibrium model of a housing market in which MW levels in each location affect housing demand by changing the income of commuters and the prices of non-tradable consumption. The model shows that the workplace MW has a positive effect on rents whereas the residence MW has a negative effect. We construct a ZIP code by month panel using rents data from Zillow, and use a difference-in-differences design to estimate the effect of residence and workplace MW changes on median housing rents. Our baseline results imply that a 10 percent increase in the workplace MW and no change in the residence MW will increase rents by 0.69 percent (SE=0.29). If the residence MW also increases by 10 percent, then rents will increase by 0.47 percent (SE=0.16). We use our results to study the incidence of two counterfactual MW policies: a federal MW increase and a city MW increase. We estimate that landlords pocket 9.2 and 11.0 cents for every dollar increase in worker income in areas affected by these policies. However, the incidence varies systematically across space.

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Minimum-Wage Increases and Low-Wage Employment: Evidence from Seattle

Cited by 28 publications

References 60 publications

How reliable are administrative reports of paid work hours?

How reliable are administrative reports of paid work hours?

Minimum Wages and Labor Markets in the Twin Cities

From Workplace to Residence: The Spillover Effects of Minimum Wage Policies on Local Housing Markets

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