Saturday, November 8, 2014
Ballroom B (Convention Center)
*Names in bold indicate Presenter
A large portion of minimum wage employment studies focus on teens for the simple reason that they are an easily identifiable low-skilled group. While it is often assumed that the employment estimates for teens can be applied to older low-skilled workers, there is little empirical evidence to support this assumption. In this study I examine the impact of the minimum wage on low-skilled adults. Using data from the Current Population Survey from 1982 through 2013, I approach this question in two ways. First, using state panel methods I estimate the impact of the minimum wage on the employment of adults (ages 20-75) with less than a high school diploma. Second, I restrict the sample to the lower 15% of the wage distribution and estimate the impact that the minimum wage has on the share of younger workers in the lower 15% of the wage distribution. I find evidence that a minimum wage increase significantly lowers the share of teens in the bottom 15% of the wage distribution, and significantly increases the share of workers aged 25 and older. Furthermore I find evidence suggesting that this is likely due to a combination of teen disemployment and an increase in employment of certain groups of older workers.