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Arabzadeh, Hamzeh, Almut Balleer, Britta Gehrke & Ahmet Ali Taskin (2024): Minimum wages, wage dispersion and financial constraints in firms. In: European Economic Review, Jg. 163, 2024-01-14. DOI:10.1016/j.euroecorev.2024.104678

Abstract

"This paper studies how minimum wages affect the wage distribution if firms face financial constraints. Using German employer-employee data and firm balance sheets, we document that the within-firm wage dispersion decreases more with higher minimum wages when firms are financially constrained. We introduce financial frictions into a search and matching labor market model with stochastic job matching, imperfect information, and endogenous effort. In line with the empirical literature, the model predicts that a higher minimum wage reduces hirings and separations. Firms become more selective such that their employment and wage dispersion fall. If effort increases strongly, firms may increase employment at the expense of higher wage dispersion. Financially constrained firms are more selective and reward effort less. As a result, within-firm wage dispersion and employment in these firms fall more with the minimum wage." (Author's abstract, IAB-Doku, © 2024 Elsevier) ((en))

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Dao, Ngoc (2024): Federal minimum wage expansion to homecare workers: Employment and income effects. In: Labour Economics, Jg. 87. DOI:10.1016/j.labeco.2024.102511

Abstract

"The rapid growth of the home care industry coincides with increases in the proportion of the population over 65 years of age and more likely to need assistance with basic daily activities due to illness or disability. Yet, the growth in home care use has been accompanied by concerns about the quality of the care provided. Higher wages and better legal protection might improve the quality of home health care services. This study examines the 2013 Home Care Rule promulgated by the Department of Labor, which added home care workers to the groups covered under the federal minimum wage with minimum hourly and overtime rates. The results show large effects (7–9 %) on part-time employment increase, small effects on work hour reduction (by 2–4 %), and nonnegative effect on overall employment level following the expansion. Despite the decline in hours worked, there is no negative impact on earnings among homecare workers." (Author's abstract, IAB-Doku, © 2024 Elsevier) ((en))

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Egger, Hartmut, Udo Kreickemeier & Jens Wrona (2024): Monopsony Power, Offshoring, and a European Minimum Wage. (CESifo working paper 10920), München, 24 S.

Abstract

"This paper sets up a two-country model of offshoring with monopolistically competitive product and monopsonistically competitive labor markets. In our model, an incentive for offshoring exists even between symmetric countries, because shifting part of the production abroad reduces local labor demand and allows firms to more strongly execute their monopsonistic labor market power. However, offshoring between symmetric countries has negative welfare effects and therefore calls for policy intervention. In this context, we put forward the role of a common minimum wage and show that the introduction of a moderate minimum wage increases offshoring and reduces welfare. In contrast, a sizable minimum wage reduces offshoring and increases welfare. Beyond that, we also show that a sufficiently high common minimum wage cannot only eliminate offshoring but also inefficiencies in the resource allocation due to monopsonistic labor market distortions in closed economies." (Author's abstract, IAB-Doku) ((en))

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Fossati, Sebastian & Joseph Marchand (2024): First to $15: Alberta's Minimum Wage Policy on Employment by Wages, Ages, and Places. In: ILR review, Jg. 77, H. 1, S. 119-142. DOI:10.1177/00197939231213064

Abstract

"Most minimum wage studies are identified on small, plentiful, mostly expected wage changes, spread out over time. A recent set of changes have instead been large, rapid, and unexpected, following the “Fight for $15” movement. Alberta is the first North American province, state, or territory to have this $15 minimum wage, with an unexpectedly large increase (47%) occurring over a short time horizon (3 years). The employment effects of this policy are estimated using a synthetic control approach on Labour Force Survey data. Similar to the existing literature, workers moved up the wage distribution, increment by increment, but with a higher distributional reach. Employment losses occurred at similar elasticities, but with large level changes, mostly among younger workers. Newer to the literature, regional employment losses were found in four of the five non-urban economic regions, but not in Alberta’s two main cities, showing the significance and nuance of regional heterogeneity." (Author's abstract, IAB-Doku) ((en))

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Gürtzgen, Nicole & Franka Vetter (2024): Mindestlohnerhöhung auf 12 Euro: Nur wenige Betriebe reagierten eigenen Angaben zufolge mit Entlassungen. In: IAB-Forum H. 04.04.2024, 2024-04-02. DOI:10.48720/IAB.FOO.20240404.01

Abstract

"Die bislang deutlichste Erhöhung des gesetzlichen Mindestlohns auf 12 Euro pro Stunde im Oktober 2022 betraf knapp 20 Prozent der Betriebe in Deutschland. Nach Daten der IAB-Stellenerhebung zeigten sich dabei große Unterschiede zwischen den Wirtschaftszweigen, wobei im Gastgewerbe anteilig am meisten, im Baugewerbe am wenigsten Betriebe betroffen waren. Als Reaktion auf die Anhebung des Mindestlohns erhöhten die Betriebe nach eigenen Angaben am häufigsten die Preise von Produkten und Dienstleistungen. Sie stellten außerdem häufiger Investitionen und Neueinstellungen zurück." (Autorenreferat, IAB-Doku)

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Kunaschk, Max (2024): The effects of minimum wages on employment and Prices - Evidence from the hairdressing sector. In: Labour Economics online erschienen am 06.04.2024. DOI:10.1016/j.labeco.2024.102540

Abstract

"This paper provides comprehensive evidence on the labor and product market effects of a high-impact minimum wage introduction in the highly competitive hairdressing sector. Using detailed administrative data, I find negligible overall employment effects, even though the minimum wage substantially increased hourly wages. However, sub-group analyses reveal considerable heterogeneity in the estimated employment effects and suggest shifts away from marginal towards regular employment. Analyses of the price effects suggest that the reform increased output prices considerably, implying that consumers largely paid for the minimum wage." (Author's abstract, IAB-Doku, © Elsevier) ((en))

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Lenhart, Otto & Kalyan Chakraborty (2024): Income assistance programs and population health – The dual impact of minimum wages and the earned income tax credit. In: Economics Letters, Jg. 234. DOI:10.1016/j.econlet.2023.111508

Abstract

"In this study, we provide new evidence on the interaction of state-level minimum wages and Earned Income Tax Credit (EITC) laws on several measures of population health. Using data from the National Vital Statistics Reports between 1999 and 2018, we estimate difference-in-differences models to evaluate the dual impact of minimum wages and the EITC on various causes of mortality, such as suicides, motor accidents and assaults. While several researchers have examined the health effects of both these policies separately, few studies have examined the potential interaction effects of these policies. Specifically, while previous work has provided evidence that both minimum wages and the EITC can reduce suicide rates, our study contributes to the literature by showing that the policies have a positive dual impact on population health. We find that a $1 increase in minimum wages reduces death rates due to suicides and assaults by 3.8 percent and 15.2 percent in states with EITC laws, respectively. In contrast, we show that minimum wages do not impact these outcomes in states without state-level EITC laws." (Author's abstract, IAB-Doku, © 2024 Elsevier) ((en))

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Moog, Alexander (2024): Internal migration after a uniform minimum wage introduction. (arXiv papers 2404.19590), 47 S. DOI:10.48550/arXiv.2404.19590

Abstract

"Internal migration is an essential aspect to study labor mobility. I exploit the German statutory minimum wage introduction in 2015 to estimate its push and pull effects on internal migration using a 2% sample of administrative data. In a conditional fixed effects Poisson difference-in-differences framework with a continuous treatment, I find that the minimum wage introduction leads to an increase in the out-migration of low-skilled workers with migrant background by 25% with an increasing tendency over time from districts where a high share of workers are subject to the minimum wage (high-bite districts). In contrast the migration decision of native-born low-skilled workers is not affected by the policy. However, both native-born low-skilled workers and those with a migrant background do relocate across establishments, leaving high-bite districts as their workplace. In addition, I find an increase for unemployed individuals with a migrant background in out-migrating from high-bite districts. These results emphasize the importance of considering the effects on geographical labor mobility when implementing and analyzing policies that affect the determinants of internal migration." (Author's abstract, IAB-Doku) ((en))

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Natili, Marcello & Stefano Ronchi (2024): The Politics of the European Minimum Wage: Overcoming Ideological, Territorial and Institutional Conflicts in the EU Multi-level Arena. In: Journal of Common Market Studies, Jg. 62, H. 3, S. 725-743. DOI:10.1111/jcms.13526

Abstract

"Until recently, the idea of a European minimum wage (EMW) policy had never taken concrete shape, due to the heterogeneity of national wage-setting and collective bargaining institutions, uncertain EU competence on the matter, and widespread scepticism amongst political actors. In 2022, however, the EU adopted a directive on adequate minimum wages. How did this make it to the EU agenda, despite the many political, territorial and institutional tensions? What coalitions supported and opposed it? Based on a reconstruction of the policy process substantiated by an analysis of news media data and 14 interviews, this article investigates the multi-level politics of the EMW. It shows that, despite enduring 'euro-social scepticism' in northern Europe, the emergence of pro-minimum wage coalitions in key member states and the increase of party-competition dynamics at the EU level were crucial in overcoming the lines of conflict that had long hindered EU initiatives on minimum wage co-ordination." (Author's abstract, IAB-Doku, Published by arrangement with John Wiley & Sons) ((en))

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Neumark, David (2024): The effects of minimum wages on (almost) everything? A review of recent evidence on health and related behaviors. In: Labour, Jg. 38, H. 1, S. 1-65. DOI:10.1111/labr.12263

Abstract

"I review and assess the evidence on minimum wage effects on health outcomes and health‐related behaviors. The evidence on physical health points in conflicting directions, leaning toward adverse effects. Research on effects on diet and obesity sometimes points to beneficial effects, whereas other evidence indicates that higher minimum wages increase smoking and drinking and reduce exercise (and possibly hygiene). In contrast, there is evidence that higher minimum wages reduce suicides, partly consistent with the evidence of positive or mixed effects on other measures of mental health/depression. Overall, policy conclusions that minimum wages improve health are unwarranted or at least premature." (Author's abstract, IAB-Doku, Published by arrangement with John Wiley & Sons) ((en))

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Ohlert, Clemens (2024): Minimum Wage Effects on Gender Gaps in Working Hours and Earnings in Germany. (ECINEQ working paper series / Society for the Study of Economic Inequality 2024-663), Verona, 26 S.

Abstract

"This paper investigates whether the introduction of a statutory minimum wage in Germany has led to a reduction in gender gaps in hourly wages, working hours and monthly earnings. Using the 2014 Structure of Earnings Survey and the 2015 Earnings Survey, a difference-in-differences approach was applied at the establishment level. The results show a reduction of the gender pay gap in establishments of up to 3.6 percentage points due to the introduction of the minimum wage. While the effects on hourly wages of women and men in low-wage jobs were the same on average, women are more often affected by the minimum wage and therefore benefit more often from it. The gender time gap in establishments decreased by about 2.4 percentage points on average and by about 3.9 percentage points among low wage workers. The minimum wage led to a reduction in the average gender gap in gross monthly earnings in establishments of up to 6.1 percentage points and by up to 4.6 percentage points among low-wage employees." (Author's abstract, IAB-Doku) ((en))

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Alessandrini, Diana & Joniada Milla (2023): Minimum Wage Effects on Human Capital Accumulation: Evidence from Canadian Data. In: Journal of Human Capital online erschienen am 04.10.2023. DOI:10.1086/728084

Abstract

"We investigate the impact of the minimum wage on individuals’ post-secondary schooling decisions. Using Canadian longitudinal data, we explore 136 minimum wage amendments and find three novel results. First, the minimum wage affects both thequantity and type of human capital acquired by students. A 10% increase in the minimum wage increases community-college enrollment by 6.2% but reduces University enrollment by 6.5%. Second, high minimum wages widen the university participation gap between individuals with different levels of parental education. Finally, Minimum wage hikes encourage workers who recently separated from their job to return to post-secondary education as mature students" (Author's abstract, IAB-Doku) ((en))

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Andrieu, Elodie & Malgorzata Kuczera (2023): Minimum Wage and Skills - Evidence from Job Vacancy Data. (TPI working papers / The Productivity Institute 034), Manchester, 62 S.

Abstract

"Low-wage occupations tend to be populated by workers with low levels of education. An increase in the minimum wage, while designed to protect workers in the lower part of the wage distribution, might result in unintended consequences for those same workers. In this paper, we study firms’ reaction to higher minimum wages, exploiting a change to the minimum-wage policy in the UK in 2016. We document how an increase in the minimum wage affects the labour hiring for different education and technical skill levels of workers. The results show that an increase in the minimum wage compressed both the demand for low educated workers and the demand for workers with low levels of technical skills (tech workers) for graduates in low and middle skilled occupations. Using a difference-in-differences framework, we find that a large and unexpected change to the minimum wage led to a 11 percentage point decrease in the proportion of non-graduate vacancies and a 15 percentage point decline in the share of low-tech ads. There is evidence for labour-labour substitution at the low-end of the skill distribution and labour-technology substitution for more educated workers as a way to compensate for labour costs increases." (Author's abstract, IAB-Doku) ((en))

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Arabzadeh, Hamzeh, Almut Balleer, Britta Gehrke & Ahmet Ali Taskin (2023): Minimum Wages, Wage Dispersion and Financial Constraints in Firms. (IZA discussion paper / Forschungsinstitut zur Zukunft der Arbeit 16455), Bonn, 56 S.

Abstract

"This paper studies how minimum wages affect the wage distribution if firms face financial constraints. Using German employer-employee data and firm balance sheets, we document that the within-firm wage dispersion decreases more with higher minimum wages when firms are financially constrained. We introduce financial frictions into a search and matching labor market model with stochastic job matching, imperfect information, and endogenous effort. In line with the empirical literature, the model predicts that a higher minimum wage reduces hirings and separations. Firms become more selective such that their employment and wage dispersion fall. If effort increases strongly, firms may increase employment at the expense of higher wage dispersion. Financially constrained firms are more selective and reward effort less. As a result, within-firm wage dispersion and employment in these firms fall more with the minimum wage." (Author's abstract, IAB-Doku) ((en))

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Backhaus, Teresa & Kai-Uwe Müller (2023): Can a federal minimum wage alleviate poverty and income inequality? Ex-post and simulation evidence from Germany. In: Journal of European Social Policy, Jg. 33, H. 2, S. 216-232. DOI:10.1177/09589287221144233

Abstract

"Minimum wages are increasingly discussed as an instrument against (in-work) poverty and income inequality in Europe. Just recently the German government opted for a substantial ad-hoc increase of the minimum-wage level to €12 per hour mentioning poverty prevention as an explicit goal. We use the introduction of the federal minimum wage in Germany in 2015 to study its redistributive impact on disposable household incomes. Based on the German Socio-Economic Panel we analyse changes in poverty and income inequality investigating different mechanisms of the transmission from individual gross wage-rates to disposable household incomes. We find that the minimum wage is an inadequate tool for income redistribution because it does not target poor households. Individuals affected by the minimum wage are not primarily in households at the bottom of the income distribution but are spread across it. Consequently, welfare dependence decreases only marginally. The withdrawal of transfers or employment effects cannot explain the limited effect on poverty. Complementary simulations show that neither full compliance nor a markedly higher level of €12 per hour can render the minimum wage more effective in reducing poverty." (Author's abstract, IAB-Doku) ((en))

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Bellmann, Lutz, Christian Dustmann, Martin Biewen, Bernardo Fanfani, Michael Oberfichtner, Bernd Fitzenberger, Sydnee Caldwell, Kerstin Ostermann, Alexandra Spitz-Oener & Steffen Müller; Christian Dustmann, Martin Biewen, Bernardo Fanfani, Michael Oberfichtner, Bernd Fitzenberger, Sydnee Caldwell, Kerstin Ostermann, Alexandra Spitz-Oener & Steffen Müller (sonst. bet. Pers.) (2023): Aktuelle Entwicklungen bei der Verteilung der Arbeitseinkommen und Kompetenzen (Podium). In: IAB-Forum H. 30.10.2023 Nürnberg. DOI:10.48720/IAB.FOO.20231030.01

Abstract

"Zu einem besseren Verständnis der Lohnfindung und Lohnverteilung sowie der beruflichen Qualifikationen beizutragen – das war das Ziel der internationalen Konferenz „Recent Developments in Wage Determination, Distribution, and Job Skills“ am IAB." (Autorenreferat, IAB-Doku)

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Bispinck, Reinhard (2023): Branchenmindestlöhne: Ein unterschätztes Instrument. (Elemente qualitativer Tarifpolitik 93), Düsseldorf, 11 S.

Abstract

"Im vergangenen Jahr stand der allgemeine gesetzliche Mindestlohn und seine Anhebung auf 12 Euro ab Oktober 2022 im Zentrum der Politik zur Begrenzung des Niedriglohnsektors. Zu Recht, denn die unmittelbare materielle Wirkung und die mittelbaren Auswirkungen etwa auf die Tarifpolitik können gar nicht hoch genug eingeschätzt werden. Dabei trat ein Instrument in den Hintergrund, das seit Mitte der 1990er Jahre in wechselndem Umfang für die Sicherung angemessener Entgelte in verschiedenen Wirtschaftszweigen eingesetzt wird – die tariflichen Branchenmindestlöhne. Sie definieren eine Lohnuntergrenze, die von allen Betrieben einer Branche eingehalten werden muss, unabhängig davon, ob sie tarifgebunden sind oder nicht. In Ergänzung zum gesetzlichen Mindestlohn haben die Branchenmindestlöhne eine wichtige Funktion zur Begrenzung von Niedriglöhnen und sie könnten und sollten in Zukunft eine stärkere Rolle spielen." (Textauszug, IAB-Doku)

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Bossler, Mario & Martin Popp (2023): Labor Demand on a Tight Leash. (LASER discussion papers 143), Erlangen, 77 S. DOI:10.48720/IAB.DP.2302

Abstract

"In diesem Aufsatz stellen wir ein Arbeitsnachfrage-Modell auf, das Einstellungskosten berücksichtigt, die aufgrund eines angespannten Arbeitsmarktes bei der Besetzung offener Stellen anfallen. Darauf aufbauend schätzen wir den Effekt der Arbeitsmarktanspannung auf die betriebliche Arbeitsnachfrage, indem wir neuartige Bartik-Instrumente sowie administrative Beschäftigungsdaten für Deutschland heranziehen. Im Einklang mit der Theorie deuten die IV-Ergebnisse darauf hin, dass ein zehnprozentiger Anstieg der Arbeitsmarktanspannung die betriebliche Beschäftigung um rund 0,5 Prozent reduziert. Außerdem zeigt sich, dass die betriebliche Lohnelastizität der Arbeitsnachfrage durch Einbeziehung von Suchexternalitäten auf der aggregierten Ebene von -0,7 auf -0,5 sinkt. In Bezug auf die Einführung des gesetzlichen Mindestlohns im Jahr 2015 implizieren die Elastizitäten nur geringfügig negative Beschäftigungseffekte, was die Ergebnisse empirischer Ex-Post-Evaluationen widerspiegelt. Darüber hinaus führte die Verdoppelung der Arbeitsmarktanspannung in Deutschland zwischen 2012 und 2019 zu einer Verringerung des Beschäftigungswachstums um rund 1,1 Millionen Arbeitsplätze." (Autorenreferat, IAB-Doku)

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Bossler, Mario & Martin Popp (2023): Labor Demand on a Tight Leash. (IAB-Discussion Paper 02/2023), Nürnberg, 90 S. DOI:10.48720/IAB.DP.2302

Abstract

"In diesem Aufsatz stellen wir ein Arbeitsnachfrage-Modell auf, das Einstellungskosten berücksichtigt, die aufgrund eines angespannten Arbeitsmarktes bei der Besetzung offener Stellen anfallen. Darauf aufbauend schätzen wir den Effekt der Arbeitsmarktanspannung auf die betriebliche Arbeitsnachfrage, indem wir neuartige Bartik-Instrumente sowie administrative Beschäftigungsdaten für Deutschland heranziehen. Im Einklang mit der Theorie deuten die IV-Ergebnisse darauf hin, dass ein zehnprozentiger Anstieg der Arbeitsmarktanspannung die betriebliche Beschäftigung um rund 0,5 Prozent reduziert. Außerdem zeigt sich, dass die betriebliche Lohnelastizität der Arbeitsnachfrage durch Einbeziehung von Suchexternalitäten auf der aggregierten Ebene von -0,7 auf -0,5 sinkt. In Bezug auf die Einführung des gesetzlichen Mindestlohns im Jahr 2015 implizieren die Elastizitäten nur geringfügig negative Beschäftigungseffekte, was die Ergebnisse empirischer Ex-Post-Evaluationen widerspiegelt. Darüber hinaus führte die Verdoppelung der Arbeitsmarktanspannung in Deutschland zwischen 2012 und 2019 zu einer Verringerung des Beschäftigungswachstums um rund 1,1 Millionen Arbeitsplätze." (Autorenreferat, IAB-Doku)

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Bossler, Mario & Thorsten Schank (2023): Wage inequality in Germany after the minimum wage introduction. In: Journal of labor economics, Jg. 41, H. 3, S. 813-857., 2022-03-17. DOI:10.1086/720391

Abstract

"Monthly wage inequality in Germany continued to increase in the early 2000s, which is mainly explained by a rising part-time employment share. After 2010, inequality returned to the level of 2000. About half of the recent decrease is due to the introduction of the national minimum wage in 2015. While employment effects of the minimum wage are negligible, we find strong wage increases among the existing workforce. The minimum wage lowered wage inequality within eastern and western Germany, but also led to a convergence of the east-west wage differential. The increased labor incomes were not offset by decreasing social benefits." (Author's abstract, © University of Chicago Press) ((en))

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Brandon, Alec, Justin E. Holz, Andrew Simon & Haruka Uchida (2023): Minimum Wages and Racial Discrimination in Hiring: Evidence from a Field Experiment. (Upjohn Institute working paper 389), Kalamazoo, Mich., 90 S. DOI:10.17848/wp23-389

Abstract

"When minimum wages increase, employers may respond to the regulatory burdens by substituting away from disadvantaged workers. We test this hypothesis using a correspondence study with 35,000 applications around ex-ante uncertain minimum wage increases in three U.S. states. Before the increases, applicants with distinctively Black names were 19 percent less likely to receive a callback than equivalent applicants with distinctively white names. Announcements of minimum wage hikes substantially reduce callbacks for all applicants but shrink the racial callback gap by 80 percent. Racial inequality decreases because firms disproportionately reduce callbacks to lower-quality white applicants who benefited from discrimination under lower minimum wages." (Author's abstract, IAB-Doku) ((en))

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Brochu, Pierre, David A. Green, Thomas Lemieux & James Townsend (2023): The Minimum Wage, Turnover, and the Shape of the Wage Distribution. (IZA discussion paper / Forschungsinstitut zur Zukunft der Arbeit 16514), Bonn, 62 S.

Abstract

"This paper proposes an empirical approach to decompose the distributional effects of minimum wages into effects for workers moving out of employment, workers moving into employment, and workers continuing in employment. We estimate the effects of the minimum wage on the hazard rate for wages, which provides a convenient way of re-scaling the wage distribution to control for possible employment effects. We find that minimum wage increases do not result in an abnormal concentration of Job Leavers below the new minimum wage, which is inconsistent with employment effects predicted by a neoclassical model. We also find that, for Job Stayers, the spike and spillover effects of the minimum wage are simply shifted right to the new minimum wage. Our findings are consistent with a model where entry wages are set according to a job ladder, and where firms preserve their internal wage structure due to fairness or internal incentives issues." (Author's abstract, IAB-Doku) ((en))

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Brochu, Pierre, David A. Green, James Townsend & Thomas Lemieux (2023): The minimum wages, turnover, and the shape of the wage distribution. (IFS working paper / Institute for Fiscal Studies 2023,32), London, 62 S.

Abstract

"This paper proposes an empirical approach to decompose the distributional effects of minimum wages into effects for workers moving out of employment, workers moving into employment, and workers continuing in employment. We estimate the effects of the minimum wage on the hazard rate for wages, which provides a convenient way of re-scaling the wage distribution to control for possible employment effects. We find that minimum wage increases do not result in an abnormal concentration of Job Leavers below the new minimum wage, which is inconsistent with employment effects predicted by a neoclassical model. We also find that, for Job Stayers, the spike and spillover effects of the minimum wage are simply shifted right to the new minimum wage. Our findings are consistent with a model where entry wages are set according to a job ladder, and where firms preserve their internal wage structure due to fairness or internal incentives issues." (Author's abstract, IAB-Doku) ((en))

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Brunner, Laura, Nina Gloger & Christian Hohendanner (2023): Sonderauswertung zur Situation der vom Mindestlohn betroffenen Betriebe im Jahr 2022 auf Basis des IAB-Betriebspanels. Abschlussbericht. Studie im Auftrag der Mindestlohnkommission. Nürnberg, 26 S.

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Burkhauser, Richard V., Drew McNichols & Joseph J. Sabia (2023): Minimum Wages and Poverty: New Evidence from Dynamic Difference-in-Differences Estimates. (NBER working paper / National Bureau of Economic Research 31182), Cambridge, Mass, 97 S.

Abstract

"Advocates of minimum wage increases have long touted their potential to reduce poverty. This study assesses this claim. Using data spanning nearly four decades from the March Current Population Survey, and a dynamic difference-in-differences approach, we find that a 10 percent increase in the minimum wage is associated with a (statistically insignificant) 0.17 percent increase in the probability of longer-run poverty among all persons. With 95% confidence, we can rule out long-run poverty elasticities with respect to the minimum wage of less than -0.129, which includes central poverty elasticities reported by Dube (2019). Prior evidence suggesting large poverty-reducing effects of the minimum wage are (i) highly sensitive to researcher’s choice of macroeconomic controls, and (ii) driven by specifications that limit counterfactuals to geographically proximate states (“close controls”), which poorly match treatment states’ pre-treatment poverty trends. Moreover, an examination of the post-Great Recession era — which saw frequent, large increases in state minimum wages — failed to uncover poverty-reducing effects of the minimum wage across a wide set of specifications. Finally, we find that less than 10 percent of workers who would be affected by a newly proposed $15 federal minimum wage live in poor families." (Author's abstract, IAB-Doku) ((en))

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Börschlein, Erik-Benjamin, Mario Bossler, Bernd Fitzenberger & Martin Popp (2023): Mit der Erhöhung auf 12 Euro liegt die Entwicklung des gesetzlichen Mindestlohns über der Tariflohn- und Preisentwicklung. In: IAB-Forum H. 11.12.2023 Nürnberg. DOI:10.48720/IAB.FOO.20231211.01

Abstract

"Zum 1. Oktober 2022 wurde der gesetzliche Mindestlohn außerplanmäßig von 10,45 Euro auf 12 Euro pro Stunde erhöht. Er liegt seither deutlich über der Entwicklung der Tariflöhne. Obwohl die hohe Inflation der vergangenen beiden Jahre die Kaufkraft des Mindestlohns geschmälert hat, liegt er preisbereinigt noch immer 11,6 Prozent über dem Niveau von 2015. Die durchschnittlichen Tariflöhne hingegen haben seitdem um 3,8 Prozent an realem Wert verloren." (Autorenreferat, IAB-Doku)

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Caliendo, Marco, Nico Pestel & Rebecca Olthaus (2023): Long-Term Employment Effects of the Minimum Wage in Germany: New Data and Estimators. (arXiv papers), 35 S.

Abstract

"We study the long-term effects of the 2015 German minimum wage introduction and its subsequent increases on regional employment. Using data from two waves of the Structure of Earnings Survey allows us to estimate models that account for changes in the minimum wage bite over time. While the introduction mainly affected the labor market in East Germany, the raises are also increasingly affecting low-wage regions in West Germany, such that around one third of regions have changed their (binary) treatment status over time. We apply different specifications and extensions of the classic difference-in-differences approach as well as a set of new estimators that enables for unbiased effect estimation with a staggered treatment adoption and heterogeneous treatment effects. Our results indicate a small negative effect on dependent employment of 0.5 percent, no significant effect on employment subject to social security contributions, and a significant negative effect of about 2.4 percent on marginal employment until the first quarter of 2022. The extended specifications suggest additional effects of the minimum wage increases, as well as stronger negative effects on total dependent and marginal employment for those regions that were strongly affected by the minimum wage in 2015 and 2019." (Author's abstract, IAB-Doku) ((en))

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Caliendo, Marco, Alexandra Fedorets, Malte Preuß, Carsten Schröder & Linda Wittbrodt (2023): The short- and medium-term distributional effects of the German minimum wage reform. In: Empirical economics, Jg. 64, H. 3, S. 1149-1175. DOI:10.1007/s00181-022-02288-4

Abstract

"This study quantifies the distributional effects of the minimum wage introduced in Germany in 2015. Using detailed Socio-Economic Panel survey data, we assess changes in the hourly wages, working hours, and monthly wages of employees who were entitled to be paid the minimum wage. We employ a difference-in-differences analysis, exploiting regional variation in the “bite” of the minimum wage. At the bottom of the hourly wage distribution, we document wage growth of 9% in the short term and 21% in the medium term. At the same time, we find a reduction in working hours, such that the increase in hourly wages does not lead to a subortionate increase in monthly wages. We conclude that working hours adjustments play an important role in the distributional effects of minimum wages." (Author's abstract, IAB-Doku, © Springer-Verlag) ((en))

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Clemens, Jeffrey & Michael R. Strain (2023): Does Wage Theft Vary by Demographic Group? Evidence from Minimum Wage Increases. (IZA discussion paper / Forschungsinstitut zur Zukunft der Arbeit 16550), Bonn, 30 S.

Abstract

"Using Current Population Survey data, we assess whether and to what extent the burden of "wage theft" - wage payments below the statutory minimum wage - falls disproportionately on various demographic groups following minimum wage increases. For most racial and ethnic groups at most ages we find that underpayment rises similarly as a fraction of realized wage gains in the wake of minimum wage increases. We also present evidence that the burden of underpayment falls disproportionately on relatively young African American workers and that underpayment increases more for Hispanic workers among the full working-age population." (Author's abstract, IAB-Doku) ((en))

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Cova, Joshua (2023): Politicizing the minimum wage: A multilingual text analysis of minimum wages in European electoral manifestos. In: Journal of European Social Policy, Jg. 33, H. 4, S. 469-483. DOI:10.1177/09589287231199561

Abstract

"This article examines the determinants of the growing political salience of minimum wages in European party manifestos. By using multilingual quantitative text analysis, I show that the electoral salience of minimum wages has increased in the past decades. Although left-wing parties emphasize minimum wages more than right-wing parties, I find that the electoral salience of this policy follows a U-shaped relationship: right-wing populist parties dedicate greater attention to minimum wages than centre-right parties do. A sentiment analysis finds that compared to other policies designed to supplement the income of low-wage workers, such as strengthening collective bargaining institutions and in-work benefits/wage subsidies, there do not seem to be specific party-political characteristics, which determine the sentiment with which discussions on minimum wages are framed." (Author's abstract, IAB-Doku) ((en))

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Di Nola, Alessandro, Luke Haywood & Haomin Wang (2023): Gendered effects of minimum wage. (Working Paper Series / Universität Konstanz, Cluster of Excellence 'The Politics of Inequality' 14), Konstanz, 52 S.

Abstract

"Women are more likely to work in jobs with low hours than men. Low-hour jobs are associated with lower hourly wages and are more likely impacted by minimum wages that set a floor on hourly wages. We document that the first German minimum wage significantly increased women's transition towards jobs with higher weekly hours. We construct and estimate an equilibrium search model with demographic and firm productivity heterogeneity. The model replicates observed gender gaps in employment, hours and wage and the positive relationship between hours and hourly wages. We implement the minimum wage in our model with a penalty to address non-compliance. Based on our model, the minimum wage primarily reduces the gender income gap through the gender wage gap. At its 2022 level, the German minimum wage reduces the gender employment and hours gap due to an upward reallocation effect, resulting in women's increased participation in higher-hour jobs with lower separation rates. The upward reallocation effect is the strongest for women with children and varies by marital state and spousal income. While the minimum wage only modestly discourages firms from posting jobs, it shifts job offers toward full-time positions." (Author's abstract, IAB-Doku) ((en))

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Dickens, Richard (2023): How are minimum wages set? (IZA world of labor 211), Bonn, 11 S. DOI:10.15185/izawol.211.v2

Abstract

"The minimum wage has never been as high on the political agenda as it is today, with politicians in Germany, the UK, the US, and other OECD countries implementing substantial increases in the rate. One reason for the rising interest is the growing consensus among economists and policymakers that minimum wages, set at the right level, may help low paid workers without harming employment prospects. But how should countries set their minimum wage rate? The processes that countries use to set their minimum wage rate and structure differ greatly, as do the methods for adjusting it. The different approaches have merits and shortcomings." (Author's abstract, IAB-Doku) ((en))

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Drechsel-Grau, Moritz (2023): Employment and Reallocation Effects of Higher Minimum Wages. (CESifo working paper 10412), München, 64 S.

Abstract

"This paper studies the employment and reallocation effects of minimum wages in Germany in a search-and-matching model with endogenous job search effort and vacancy posting, multiple employment levels, a progressive tax-transfer system, and worker and firm heterogeneity. I find that minimum wages up to 70% of the median wage significantly increase productivity, hours worked and output without reducing employment. In frictional labor markets, however, reallocation takes time whenever the minimum wage cuts deep into the wage distribution. I show that gradually implementing a high minimum wage is necessary to avoid elevated unemployment rates during the transition." (Author's abstract, IAB-Doku) ((en))

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Dumpert, Florian & Martin Beck (2023): Verbesserung der Datengrundlage der Mindestlohnforschung mittels maschineller Lernverfahren. In: Wirtschafts- und Sozialstatistisches Archiv, Jg. 17, H. 1, S. 5-34. DOI:10.1007/s11943-023-00318-w

Abstract

"Mit der Einführung des allgemeinen gesetzlichen Mindestlohnes zum 1. Januar 2015 stieg der Bedarf an geeigneten Daten für die Evaluation der Mindestlohnwirkungen. Die Mindestlohnkommission empfahl daher in ihrem ersten Bericht an die Bundesregierung die Verknüpfung der Integrierten Erwerbsbiografien mit der Verdienststrukturerhebung. Die Paneldaten der Integrierten Erwerbsbiografien sollen durch die Verknüpfung mit ansonsten fehlenden Angaben zum Bruttostundenverdienst bzw. zur Mindestlohnbetroffenheit aus der Verdienststrukturerhebung angereichert werden, um so die Analysemöglichkeiten zu verbessern. Sowohl ein deterministisches als auch ein probabilistisches Record Linkage waren aus rechtlichen Gründen nicht umsetzbar. Daher hat das Statistische Bundesamt die Option einer Anreicherung der Integrierten Erwerbsbiografien mit Informationen zur Mindestlohnbetroffenheit aus der Verdienststrukturerhebung auch mittels maschineller Lernverfahren geprüft. Im Fokus standen die Methoden „Random Forest“ und „Boosting“, die keine Verknüpfung oder Weitergabe von Einzeldatensätzen erfordern und daher datenschutzrechtlich handhabbar sind. Über die konkrete Vorgehensweise, speziell die getesteten Modellierungsvarianten für die Teilpopulationen Vollzeit‑, Teilzeit- und geringfügig entlohnte Beschäftigte, wird in diesem Beitrag ausführlich berichtet." (Autorenreferat, IAB-Doku, © Springer-Verlag)

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Dütsch, Matthias, Orkun Altun, Luisa Grundmann & Ralf Himmelreicher (2023): What does the German minimum wage do? The impact of the introduction of the statutory minimum wage on the composition of low- and minimum-wage labour. (baua: Preprint / Bundesanstalt für Arbeitsschutz und Arbeitsmedizin), Dortmund, 30 S. DOI:10.21934/baua:preprint20230201

Abstract

"In this article, we examine structural changes in minimum-wage and low-wage labour after the introduction and first increase of the German minimum wage. Changes in the risks workers face of earning gross hourly wages below the minimum-wage or low-wage thresholds are identified by comparing individual, company-level and sectoral characteristics based on the Structure of Earnings Surveys (SESs) 2014 and 2018. The SES is a mandatory survey of companies that provides information on wages and working hours for approximately 1 million jobs and nearly 70,000 companies from all industries. Using these rich data, we present the first systematic analysis of how structural changes in individual-, company-, and industry-level determinants affect minimum- and low-wage workers. Using a descriptive analysis, we first summarize the changing pattern in jobs, companies, and industries after the minimum wage introduction. Second, we use random intercept-only models to estimate the explanatory power of the individual, company, and industry levels in the years 2014 and 2018 respectively. Third, we perform logistic and linear regression estimations to assess the changing risks of having a minimum- or low-wage job and the distance between a worker’s actual earnings and the minimum and low-wage thresholds. We conclude that the minimum wage had an elevator effect regarding minimum-wage labour. However, compositional effects regarding the minimum-wage and low-wage workforce were evident in terms of individual and company factors. There was a selective redistribution of minimum-wage employees into slightly higher wage ranges. Furthermore, convergence seems to have occurred predominantly among sectors, as their explanatory power for lower wages declined." (Author's abstract, IAB-Doku) ((en))

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Dütsch, Matthias, Orkun Altun, Luisa Grundmann & Ralf Himmelreicher (2023): What Does the German Minimum Wage Do? The Impact of the Introduction of the Statutory Minimum Wage on the Composition of Low- and Minimum-Wage Labour. In: Jahrbücher für Nationalökonomie und Statistik, Jg. 243, H. 3-4, S. 355-396. DOI:10.1515/jbnst-2022-0070

Abstract

"In this article, we examine structural changes in minimum wage and low wage labor following the introduction and first increase of the German minimum wage. Changes in the impact that workers face earning gross hourly wages below the minimum-wage or low-wage thresholds are identified by comparing individual, company and sectoral characteristics based on the Structure of Earnings Surveys (SESs) 2014 and 2018. The SES is a mandatory survey of companies that provides information on wages and working hours for approximately 1 million jobs and nearly 70,000 companies across all industries. Using these rich data, we present the first systematic analysis of how structural changes in individual-, company-, and industry-level determinants affect minimum- and low-wage workers. Using descriptive analysis, we first summarize the changing pattern in jobs, companies, and industries after the introduction of minimum wage. Second, we use random intercept-only models to estimate the explanatory power at the individual, company, and industry levels in 2014 and 2018. Third, we perform logistic and linear regression estimations to assess the changing trends in having a minimum- or low-wage job and the distance between a worker’s actual earnings and the minimum- and low-wage thresholds. We conclude that the minimum wage had an elevator effect on minimum wage labor. However, compositional effects regarding the minimum-wage and low-wage workforce were evident in terms of individual and company factors. There was a selective redistribution of minimum wage employees into slightly higher wage ranges. Furthermore, convergence seems to have occurred predominantly among sectors, as their explanatory power for lower wages declined." (Author's abstract, IAB-Doku, © De Gruyter) ((en))

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Fazio, Andrea & Tommaso Reggiani (2023): Minimum wage and tolerance for high incomes. In: European Economic Review, Jg. 155. DOI:10.1016/j.euroecorev.2023.104445

Abstract

"We suggest that stabilizing the baseline income can make low-wage workers more tolerant towards high income earners. We present evidence of this attitude in the UK by exploiting the introduction of the National Minimum Wage (NMW), which institutionally sets a baseline pay reducing the risk of income losses and providing a clear reference point for British workers at the lower end of the income distribution. Based on data from the British Household Panel Survey (BHPS), we show that workers who benefited from the NMW program became relatively more tolerant of high incomes and more likely to support and vote for the Conservative Party. As far as tolerance for high incomes is related to tolerance of inequality, our results may suggest that people advocate for equality also because they fear income losses below a given reference point." (Author's abstract, IAB-Doku, © 2023 Elsevier) ((en))

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Fazio, Andrea & Tommaso G. Reggiani (2023): Minimum Wage and Tolerance for High Incomes. (IZA discussion paper / Forschungsinstitut zur Zukunft der Arbeit 16107), Bonn, 27 S.

Abstract

"We suggest that stabilizing the baseline income can make low-wage workers more tolerant towards high income earners. We present evidence of this attitude in the UK by exploiting the introduction of the National Minimum Wage (NMW), which institutionally sets a baseline pay reducing the risk of income losses and providing a clear reference point for British workers at the lower end of the income distribution. Based on data from the British Household Panel Survey (BHPS), we show that workers who benefited from the NMW program became relatively more tolerant of high incomes and more likely to support and vote for the Conservative Party. As far as tolerance for high incomes is related to tolerance of inequality, our results may suggest that people advocate for equality also because they fear income losses below a given reference point." (Author's abstract, IAB-Doku) ((en))

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Filauro, Stefano, Klaus Grünberger & Edlira Narazani (2023): The Impact of Minimum Wages on Income Inequality in the EU. (JRC working papers on taxation and structural reforms 2023,04), Seville, 33 S.

Abstract

"A number of studies documents that minimum wage policies have the potential to reduce income inequality. The recently adopted EU Commission's proposal for a Directive on adequate minimum wages was supported by a detailed analysis of the social impacts of hypothetical minimum wage levels in countries with a statutory minimum wage. This paper extends these country-level analyses by exploring the impact of minimum wage policies on EU-level income inequality. To our knowledge, this is the first study that uses a microsimulation model such as EUROMOD to assess the impact of EU-promoted policies on the distribution of income in the EU, beyond their national effects. Assuming no employment effects, static simulation results show that a hypothetical minimum wage corresponding to 60% of the national median wage would bring about a small but significant reduction in EU-level disposable income inequality (by 0.75% in 2019 as measured through the Gini index). This result stems primarily from a reduction in the within-country component of income inequality as the effect on inequality between countries is rather muted. The reduction in EU-level income inequality is the highest in disposable incomes, but some reduction is detectable also in market incomes. In turn, the withdrawal of social benefits because of higher minimum wages seems to neutralise part of this inequality reduction." (Author's abstract, IAB-Doku) ((en))

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Forsythe, Eliza (2023): The Effect of Minimum Wage Policies on the Wage and Occupational Structure of Establishments. In: Journal of labor economics, Jg. 41, H. S1, S. S291-S324. DOI:10.1086/726820

Abstract

"Using establishment-level panel data from the Occupational Employment and Wage Statistics program, I estimate the effect of minimum wage increases implemented by 10 states in 2014 and 2015. I show that minimum wage increases lead to wage spillovers within establishments. I find little evidence that minimum wage increases induce establishments to reorganize their occupational mix. Finally, I find that minimum wage increases propagate up the management hierarchy, leading to increased wages for supervisors. Nonetheless, I find overall wage inequality decreases within establishments after minimum wage increases." (Author's abstract, IAB-Doku) ((en))

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Friedrich, Martin, Elke Jahn, Michael Oberfichtner, Johannes Weiß, Alan Manning & David Card; Alan Manning & David Card (sonst. bet. Pers.) (2023): Unvollkommener Wettbewerb auf dem Arbeitsmarkt: Ursachen, Ausmaß und Folgen (Podium). In: IAB-Forum H. 24.08.2023 Nürnberg. DOI:10.48720/IAB.FOO.20230824.01

Abstract

"Bei vollkommenem Wettbewerb auf dem Arbeitsmarkt, so die klassische ökonomische Theorie, verliert ein Arbeitgeber, der seine Löhne auch nur minimal senkt, sämtliche Beschäftigten. In der Realität ist dies jedoch nur höchst selten der Fall. Denn auf Arbeitsmärkten herrscht in aller Regel nur unvollkommener Wettbewerb. Arbeitgeber verfügen demnach über eine gewisse Marktmacht und können diese nutzen, um niedrigere Löhne zu zahlen, als sie es bei vollkommenem Wettbewerb tun müssten." (Autorenreferat, IAB-Doku)

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Fulda, Carolin, Hagen Lesch, Christoph Schröder, Sandra Vogel, Reinhard Bispinck, Malte Lübker & Thorsten Schulten (2023): Auswirkungen des gesetzlichen Mindestlohns auf das Tarifgeschehen. Studie im Auftrag der Mindestlohnkommission. Berlin, 242 S.

Abstract

"Die vorliegende Studie untersucht, welche Auswirkungen der gesetzliche Mindestlohn auf das Tarifgeschehen ausgewählter Niedriglohnbranchen hatte. Die Analyse konzentriert sich auf den Zeitraum von Anfang des Jahres 2020 bis Ende des Jahres 2022, sodass insbesondere die Rolle des Mindestlohns unter den Bedingungen der Corona-Pandemie berücksichtigt wird. Einen besonderen Schwerpunkt stellt zudem die Anhebung des Mindestlohns auf 12 Euro je Stunde zum 1. Oktober 2022 dar. Untersucht wird, welche Zusammenhänge zwischen dem Tarifgeschehen sowie den Anpassungen des gesetzlichen Mindestlohns bestehen und welche Folgen sich durch die Mindestlohnerhöhung auf 12 Euro je Stunde für das Tarifgeschehen abzeichnen. Zu den untersuchten Branchen gehören die Landwirtschaft, die Fleischwirtschaft, das Bäckerhandwerk, der Einzelhandel, die Floristik, das Gastgewerbe, die Systemgastronomie, die Wach- und Sicherheitsdienste, das Gebäudereiniger- und das Friseurhandwerk. Außerdem wurde stellvertretend für die Kinobranche, in der es keinen Branchentarifvertrag gibt, ein Haustarifvertrag der Kinokette CinemaxX einbezogen. Da in den untersuchten Branchen teilweise regional verhandelt wird, wurde der Fokus auf die Tarifgebiete Nordrhein-Westfalen und Berlin-Brandenburg gerichtet. Damit wurden nicht nur ein West- und ein Osttarifgebiet ausgewählt, sondern auch Branchen, in denen zumeist regelmäßig Tarifverhandlungen stattfanden." (Autorenreferat, IAB-Doku)

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Fulda, Carolin, Hagen Lesch, Christoph Schröder & Sandra Vogel (2023): Einflüsse des Mindestlohns auf das Tarifgeschehen: Ergebnisse ausgewählter Niedriglohnbranchen. (IW-Analysen / Institut der Deutschen Wirtschaft Köln 154), Köln: Institut der deutschen Wirtschaft (IW) / German Economic Institute, 65 S.

Abstract

"Die vorliegende Analyse untersucht, welche Zusammenhänge zwischen dem Tarifgeschehen sowie den seit Juni 2020 von der Mindestlohnkommission beschlossenen Anpassungen des gesetzlichen Mindestlohns bestehen und welchen Einfluss der politische Eingriff in den Anpassungsmechanismus im Jahr 2022 hatte. Zu den untersuchten Branchen gehören die Landwirtschaft, die Fleischwirtschaft, das Bäckerhandwerk, der Einzelhandel, die Floristik, das Gastgewerbe, die Systemgastronomie, die privaten Wach- und Sicherheitsdienste, das Gebäudereiniger- und das Friseurhandwerk, jeweils mit Fokus auf die Tarifgebiete Nordrhein-Westfalen und Berlin-Brandenburg. Die Verbindung quantitativer und qualitativer Methoden zeigt, dass das Tarifgeschehen vor allem durch den Beschluss der Bundesregierung beeinflusst wurde, den Mindestlohn ab Oktober 2022 auf 12 Euro je Stunde zu erhöhen. Viele Tariflohngruppen drohten durch den politischen Beschluss verdrängt zu werden. In den meisten der untersuchten Branchen gelang es, die Tarifstrukturen anzupassen. Auslaufende Tarifverträge wurden zumeist regulär erneuert, teilweise wurden auch Tarifverhandlungen vorgezogen. Mit dem jüngsten Anpassungsbeschluss der Mindestlohnkommission vom Juni 2023 ist die Verlässlichkeit in die Mindestlohnentwicklung zurückgekehrt. Das erleichtert es den Tarifvertragsparteien, mit den Mindestlohnerhöhungen Schritt zu halten und die zum Teil gestauchten Tariflohnstrukturen schrittweise wieder auszudifferenzieren." (Autorenreferat, IAB-Doku)

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Gerritsen, Aart (2023): To Redistribute or to Predistribute? The Minimum Wage versus Income Taxation When Workers Differ in Both Wages and Working Hours. (CESifo working paper 10734), München, 53 S.

Abstract

"I consider the case for the minimum wage alongside (optimal) income taxes when workers differ in both wages and working hours, such that a given level of income corresponds to multiple wage rates. The minimum wage is directly targeted at the lowest-wage workers, while income taxes are at most targeted at all low-income workers, regardless of their hourly wage rates. This renders the minimum wage unambiguously desirable in a discrete-type model of the labor market. Desirability of the minimum wage is a priori ambiguous in a continuous-type model of the labor market. Compared to the minimum wage, income taxes are less effective in compressing the wage distribution but more effective in redistributing income. Desirability of the minimum wage depends on this trade-off between the “predistributional advantage” of the minimum wage and the “redistributional advantage” of the income tax. I derive a desirability condition for the minimum wage and write it in terms of empirical sufficient statistics. A numerical application to the US suggests a strong case for a higher federal minimum wage – especially if social preferences for the lowest-wage workers are relatively strong and the wage elasticity of labor demand relatively small." (Author's abstract, IAB-Doku) ((en))

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Glasner, Benjamin (2023): The Minimum Wage, Self-Employment, and the Online Gig Economy. In: Journal of labor economics, Jg. 41, H. 1, S. 103-127. DOI:10.1086/719690

Abstract

"This paper estimates the effect of minimum wage increases on work that is not covered by minimum wage laws. I find minimum wage increases in the early 2000s resulted in small reductions in engagement in traditional self-employment. Following the development of the online gig economy in the 2010s, a 10% increase in the minimum wage increased the number of non-employer establishments classified as transportation and warehousing services by approximately 2.7%. The counties most likely to exhibit a positive relationship between the minimum wage and participation in uncovered work are those with low labor market concentration and active Uber marketplaces." (Author's abstract, IAB-Doku) ((en))

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Goerke, Laszlo & Markus Pannenberg (2023): Minimum Wage Non-compliance: The Role of Co-determination. (IAAEU discussion paper series in economics / Institut für Arbeitsrecht und Arbeitsbeziehungen in der Europäischen Union 2023,04), Trier, 35 S.

Abstract

"We analyse in what way co-determination affects non-compliance with the German minimum wage, which was introduced in 2015. The Works Constitution Act (WCA), the law regulating co-determination at the plant level, provides works councils with indirect means to ensure compliance with the statutory minimum wage. Based on this legal situation, our theoretical model predicts that non-compliance is less likely in co-determined firms because works councils enhance the enforcement of the law. The economic correlates of co-determination, such as higher productivity and wages, affect non-compliance in opposite directions. The empirical analysis, using data from the German Socio-economic Panel (SOEP) for the years 2016 and 2019, demonstrates that non-compliance occurs less often for employees in co-determined establishments, while there is no impact on the difference between the minimum wage and the amount, which was actually paid. Therefore, co-determination helps to secure the payment of minimum wages." (Author's abstract, IAB-Doku) ((en))

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Haapanala, Henri, Ive Marx & Zachary Parolin (2023): Decent wage floors in Europe: Does the minimum wage directive get it right? In: Journal of European Social Policy, Jg. 33, H. 4, S. 421-435. DOI:10.1177/09589287231176977

Abstract

"The Directive on Adequate Minimum Wages represents a watershed initiative adding substance to the EU’s social dimension. It contains two ambitious objectives: establishing the minimum level of statutory minimum wages at 60% of the gross median wage, and increasing collective bargaining coverage (CBC) to at least 80% of workers. In this article, we assess how statutory minimum wages and collective bargaining coverage are associated with the likelihood of low pay. Using a time series cross-section of EU-SILC for income years 2004–2019, we identify and assess the absolute and relative size of ‘effective wage floors’ for full-time employees in 30 countries. We specify multilevel, random effects within-between regression models to assess the individual and joint associations of SMW and collective bargaining coverage with wage floors. Our results indicate that SMWs and CBC both have distinct roles in establishing the effective wage floor. First, higher collective bargaining coverage is on average associated with a lower share of workers earning below 60% gross median wages. Second, higher SMWs are strongly associated with higher effective wage floors. Third, both collective bargaining coverage and union density are strongly associated with higher wage floors." (Author's abstract, IAB-Doku) ((en))

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Hamilton, Reg & Matt Nichol (2023): One Hundred Years of Dynamic Minimum Wage Regulation: Lessons from Australia, the United Kingdom and the United States. In: International Labour Review, Jg. 162, H. 3, S. 407-429. DOI:10.1111/ilr.12380

Abstract

"Since the first minimum wage legislation was introduced in Australia, the United Kingdom and the United States in the early 1900s, minimum wage regulation has attracted controversy. Opponents of minimum wage levels rely on market theory, while supporters acknowledge the role of markets in setting the price of labour but justify state intervention based on principles of equity and social good. This article examines how these two ideological positions influenced fixing what is both a crucial cost for business and underpinning of worker and family living standards, and whether effective wage fixing has resulted. Little comparative research exists on the origins, evolution and current systems of minimum wage regulation in the three countries and this article aims to address this gap in the literature." (Author's abstract, IAB-Doku, Published by arrangement with John Wiley & Sons) ((en))

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Hean, Oudom & Nanxin Deng (2023): The effects of minimum wages over the business cycle: the Great Recession. In: International Journal of Manpower, Jg. 44, H. 1, S. 19-36. DOI:10.1108/IJM-07-2021-0402

Abstract

"Purpose: This paper examines disemployment effects of minimum wages during the period 2002–2010. Design/methodology/approach: The authors employ the discontinuity design. Findings: The authors find that minimum wages had a significant negative impact on teen employment before the Great Recession. During the Great Recession, the disemployment effects of minimum wages were insignificant. The finding is consistent with the evolution of firms' market power during the business cycle. Originality/value: The authors attempt to reconcile the debate about the effects of minimum wages on US employment." (Author's abstract, IAB-Doku, © Emerald Group) ((en))

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Herzog-Stein, Alexander, Malte Lübker, Toralf Pusch, Thorsten Schulten & Andrew Watt (2023): Europäische Mindestlohnrichtlinie schafft neue Spielräume für eine Weiterentwicklung des deutschen Mindestlohngesetzes. Gemeinsame Stellungnahme von IMK und WSI anlässlich der schriftlichen Anhörung der Mindestlohnkommission 2023. (WSI policy brief 75), Düsseldorf, 30 S.

Abstract

"Mit dieser gemeinsamen Stellungnahme wollen das Wirtschafts- und Sozialwissenschaftliche Institut (WSI) und das Institut für Makroökonomie und Konjunkturforschung (IMK) der Hans-Böckler-Stiftung einen Beitrag zur Arbeit der Mindestlohnkommission erbringen. Seit mehreren Jahren begleiten die zwei Institute die wissenschaftliche und wirtschaftspolitische Diskussion zum Mindestlohn. Diese Stellungnahme folgt auf eine der zwei Institute, die vor zwei Jahren der Mindestlohnkommission vorgelegt wurde. Die Mindestlohnkommission muss ihre Empfehlung für die nächste Mindestlohnanpassung in einem komplexen und von erhöhter Unsicherheit geprägten Umfeld entwickeln. Zu nennen sind insbesondere die Anpassung des Mindestlohns auf 12 Euro im Oktober 2022, die neue EU-Mindestlohnrichtlinie und die im Zuge des russischen Angriffs auf die Ukraine rasant gestiegene Inflation. Ziel der Stellungnahme ist es, relevante Daten und Einschätzungen zusammenzutragen, die als Orientierung dienen können." (Textauszug, IAB-Doku)