Thursday, May 21, 2015

Young Black Males and the Minimum Wage

For every 10 percent increase in minimum wage, employment for 16-19 year old black and Hispanic teens falls 6.6 %.
(Employment Policies Institute)

"Moreover, the estimates indicated that increases in the minimum wage tend to raise the probability that non-enrolled teenage workers become both non-enrolled and non-employed and reduce the probability that already non-enrolled/non-employed teenagers find a job; these results were especially pronounced for blacks and Hispanics and for individuals who had a lower wage prior to the increase in the minimum wage.

In sum, the evidence from this analysis suggested that the teenage employment elasticities typically reported in the literature likely understate the size of the disemployment effects on the lowestskilled workers, instead capturing net employment changes among a broader group of teenagers that mask labor-labor substitution."

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