Does Raising the Minimum Wage Help the Poor?*

Andrew Leigh

The Economic Record, 2007, vol. 83, issue 263, 432-445

Abstract: What is the impact of raising the minimum wage on family incomes? Using data from the 1994–1995 to 2002–2003 Survey of Income and Housing, the characteristics of low‐wage workers are analysed. Those who earn near‐minimum wages are disproportionately female, unmarried and young, without postschool qualifications and overseas born. About one‐third of near‐minimum‐wage workers are the sole worker in their household. Due to low labour force participation rates in the poorest households, minimum‐wage workers are most likely to be in middle‐income households. Under plausible parameters for the effect of minimum wages on hourly wages and employment, it appears unlikely that raising the minimum wage will significantly lower family income inequality.

Date: 2007
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https://doi.org/10.1111/j.1475-4932.2007.00432.x

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Working Paper: Does Raising the Minimum Wage Help the Poor? (2005)
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