Unequal Harm: Racial Disparities in the Employment Consequences of Minimum Wage Increases
- William Even, Miami University
- David Macpherson, Trinity University
This study examines whether wage mandates have a disparate impact on minority groups. Using a dataset that spans almost 20 years and contains 600,000 observations, the authors find substantial disparities in the employment consequences of a higher minimum wage. For instance, each 10 percent increase in the minimum wage is found to reduce employment of young, less-educated white males by 2.5 percent; by contrast, a 10 percent increase reduces employment for black males in this group by 6.5 percent. For this vulnerable group, the impact of the 40 percent federal minimum wage increase between 2007 and 2009 was found to be almost as harmful as the impact of the Great Recession.