Employment effects of the new German minimum wage: evidence from establishment-level micro data

Mario Bossler and Hans-Dieter Gerner
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Hans-Dieter Gerner: Institute for Employment Research (IAB), Nuremberg, Germany

No 201610, IAB-Discussion Paper from Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]

Abstract: "In Germany a new statutory minimum wage of EURO 8.50 per hour of work was introduced on 1 January 2015. We identify employment effects using variation in the establishment-level affectedness. The data allow us to address anticipatory wage adjustments as well as spillover effects within and across workplaces. Difference-indifferences estimation reveals an increase in average wages by 4.8 percent and an employment reduction by about 1.9 percent in affected establishments. These estimates imply an employment elasticity with respect to wages of about -0.3. Looking at the associated labor flows, the employment effect seems mostly driven by a reduction in hires but also by a small increase in separations. Moreover, the employment neutral turnover rate decreases. When analyzing alternative adjustment margins, we observe a reduction in the typical contracted working hours but no effects on freelance employment." (Author's abstract, IAB-Doku) ((en))

Keywords: Bundesrepublik Deutschland; Beschäftigerverhalten; Beschäftigungseffekte; Beschäftigungsform; IAB-Betriebspanel; Lohnhöhe; Mindestlohn; Personalanpassung; Selbständige; Arbeitszeit; 2014-2015 (search for similar items in EconPapers)
JEL-codes: C23 J23 J38 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2016
New Economics Papers: this item is included in nep-eur and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (63)

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Related works:
Journal Article: Employment Effects of the New German Minimum Wage: Evidence from Establishment-Level Microdata (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:iab:iabdpa:201610

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