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A Higher Minimum Wage Equals a Stronger Economy

A new study from UC Berkley finds that a higher minimum wage is good for the entire community

Posted on
Sep 07, 2018

Politico's Morning Shift recently reported on a new study that finds a correlation between a higher minimum wage and a growing economy.

Cities that raised their hourly minimum wage above $10 enjoy stronger economic growth, according to a just-released study from the Institute for Research on Labor and Employment at UC Berkeley. The study analyzed the effects of minimum wage policies on food-service workers in Chicago, the District of Columbia, Oakland, San Francisco, San Jose, and Seattle.

"On average across the six cities, we find that a 10 percent increase in the minimum wage increases earnings in the food services industry between 1.3 and 2.5 percent. This result is very similar to the estimates in previous studies of minimum wage levels up to $10," write economists Sylvia A. Allegretto, Carl Nadler and Michael Reich. "In addition to our findings of positive effects on earnings, we do not detect negative significant employment effects in any of the individual cities, or when pooling them together." Read the report here.

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