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Wage growth among minimum wage workers
W.E. Even and D. A. Macpherson,
Employment Policies Institute, Washington, June,
25 p.,
(2004).
Résumé - Summary
Arguments in favor of increasing federal and state minimum wages often hinge
on a belief that minimum wage employees are dependent on these government
policies to receive a wage increase. Policymakers often believe that these
employees receive raises only when the minimum wage is increased implying a
notion that these individuals are unable to increase their skill level and
corresponding wages without the government's assistance. In this study, Drs.
William Even and David Macpherson of Miami University of Ohio and Florida State
University, respectively, show that wage growth among minimum wage employees is
actually quite robust. Using over two decades of Current Population Survey (CPS)
data, these authors dispel the notion that minimum wage employees are dependent
on government policies to increase their wages. The authors also examine the
factors that lead to wage growth and find that higher education and job training
along with a strong labor market are significant contributing factors.