New Study Reveals That Cities That Increased Minimum Wage Saw No Slowdown In Job Growth

The numbers are in and they are looking great for proponents of a minimum wage increase.

New York Magazine reports:

“In November 2012, fast food workers across the United States walked off their jobs to demand a living wage. This spurred a raft of minimum-wage hikes in major American cities — and many heated arguments among economists about whether such measures would help or hurt the working poor. Some (typically conservative) policy analysts insisted that raising the wage floor would lead employers to cut staff and hours, leaving those on the bottom rungs of the labor ladder even more cash-strapped than they were before the government intervened. Other (typically liberal) technocrats argued that effects on unemployment would be minimal, and could even be positive: The more cash workers earn, the more they’ll spend — and the more workers businesses will have to hire to keep pace with demand.

Now, the debate over minimum-wage hikes in 21st-century American metropolises is finally moving from the realm of theory to fact. The results from our natural experiments are coming in — and the latest numbers look like a win for team ‘forcing businesses to pay their workers more money is good.’

In the first six major U.S. cities to raise their minimum wage above $10 an hour, workers’ earnings went up while job growth held steady or improved, according to a new study from Berkeley’s Center on Wage and Employment Dynamics.

Drawing on data from the Labor Department, the economists found that across the six cities studied, a 10 percent increase in the minimum wage boosted weekly earnings in the food services industry by an average of between 1.3 and 2.5 percent (depending on which economic model they used) by the end of 2016. Meanwhile, their models pegged the wage hikes’ impact on jobs to a range of 0.3 percent reduction (i.e. negative but tiny) to a 1.1 percent increase.

‘We find that they are working just as the policy-makers and voters who enacted these policies intended,’ Sylvia Allegretto, co-author of the report, told the Seattle Times. ‘So far they are raising the earnings of low-wage workers without causing significant employment losses.'”

For the rest of the story, visit New York Magazine here.

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