Study of Minimum Wage Shows Mixed Results

By Free Radical

A recent study by Washington University scholars shows that raising the minimum wage has had both positive and negative ramifications for local economies. These issues are of importance for cities such as St. Louis that are in the middle of contentious debates over raising worker pay.

In a working paper, the scholars looked at six states that raised their minimum wages between 2010 and 2015. They found that workers who received a wage increase were no more likely to be fired than workers who did not receive one. This is key as opponents often argue that raising a minimum wage will lead to workers losing their jobs. This position has been derided as paternalistic because most workers who make a minimum wage desire a higher pay. With the study, this excuse for not raising the minimum wage is seen not only as paternalistic, but also inaccurate.

The study, however, also found that businesses hired fewer workers a year after their respective states raised their minimum wage rates.

The research was conducted by Washington University business professors Radhakrishnan Gopalan and Barton Hamilton and graduate students Ankit Kalda and David Sovic.

St. Louis and Missouri is currently embroiled in a fight to secure its recent minimum wage hike. In 2015, St. Louis passed an ordinance to raise its pay floor to $11 an hour by 2018. Though the law was challenged by business groups, the Missouri Supreme Court upheld it earlier this year.

However, last month Missouri legislators voted to prevent local municipalities from raising their minimum wage. The measure is currently awaiting Governor Greitens’s signature or veto.

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