A proposal to raise the federal minimum wage to $15 by 2024 would increase the relative minimum w... more A proposal to raise the federal minimum wage to $15 by 2024 would increase the relative minimum wage – the ratio to the national median wage– to about .68. In Alabama and Mississippi, our two lowest-wage states, the relative minimum wage would rise to .77 and .85, respectively. Yet research on state-level minimum wage policies does not extend beyond $10; the highest studied state-level relative minimum wage is .59. To close this gap we study minimum wage effects in counties and PUMAs where relative minimum wage ratios already reach as high as .82. Using ACS data since 2005 and 51 events, we sort counties and PUMAs according to their relative minimum wages and bites. We report average results for all the events in our sample, and separately for those with lower and higher impacts. We find positive wage effects but do not detect adverse effects on employment, weekly hours or annual weeks worked. We do not find negative employment effects among women, blacks and/or Hispanics. We do fin...
Michael Reich is a Professor at UC Berkeley and Director of the UC Berkeley Institute for Researc... more Michael Reich is a Professor at UC Berkeley and Director of the UC Berkeley Institute for Research on Labor and Employment; Ken Jacobs is the Chair of the UC Berkeley Center for Labor Research and Education; Annette Bernhardt is a visiting professor of sociology and visiting researcher, Institute for Research on Labor and Employment; Ian Perry is a researcher at the UC Berkeley Center for Labor Research and Education.
In recent years, a new wave of state and local activity has transformed minimum wage policy in th... more In recent years, a new wave of state and local activity has transformed minimum wage policy in the U.S. As of August 2018, ten large cities and seven states have enacted minimum wage policies in the $12 to $15 range.1 Dozens of smaller cities and counties have also enacted wage standards in this range.2 These higher minimum wages, which are being phased in gradually, will cover well over 20 percent of the U.S. workforce. With a substantial number of additional cities and states poised to soon enact similar policies, a large portion of the U.S. labor market will be held to a higher wage standard than has been typical over the past 50 years. These minimum wage levels substantially exceed the previous peak in the federal minimum wage, which reached just under $10 (in today’s dollars) in the late 1960s. As a result, the new policies will increase pay directly for 15 to 30 percent of the workforce in these cities and as much as 40 to 50 percent of the workforce in some industries and reg...
Declining labor force participation rates among less-educated individuals in the U.S. have been a... more Declining labor force participation rates among less-educated individuals in the U.S. have been attributed to various causes, including skill-biased technical change, demand shocks induced by international competition, looser eligibility requirements for disability insurance, the opioid epidemic and the nature of child care and family leave policies. In this paper, we examine how the labor supply of parents of dependent children respond to minimum wage changes. We implement an event study framework and document a sharp rise in employment and earnings of parents after state minimum wage increases. We further show that these effects are concentrated among jobs that pay the minimum wage or slightly higher – high wage employment remains unaffected. Panel models find corresponding drops in welfare receipts, moreover, for single mothers, effects are larger for mothers of preschool age children. The results are consistent with a simple labor supply model in which means-tested transfers and...
Author(s): Reich, Michael | Abstract: Uber and Lyft currently treat their California drivers as i... more Author(s): Reich, Michael | Abstract: Uber and Lyft currently treat their California drivers as independent contractors, despite state employment law giving the drivers employee status. The companies claim that drivers are already well-paid and that employee status would bring the industry to its knees. Driver advocates claim that drivers are low-paid and do not receive basic benefits and protections, such as unemployment insurance and workers’ compensation, and that the companies should treat the drivers as employees and adhere to California employment law.I examine here the economic and financial consequences of switching the drivers to employee status. In particular, I examine the effects on pay and employment of the drivers, the effects on passengers, and the profitability of the industry. I find that: most drivers are paid much less than the current minimum wage and that overall compensation of drivers would increase 30 percent; that driver schedule flexibility would not be aff...
The surprising increase in U.S. unemployment in the Great Recession and the persistence of long-t... more The surprising increase in U.S. unemployment in the Great Recession and the persistence of long-term unemployment in the economic recovery pose important questions for employment policy. Why did unemployment grow more than forecast? Is the character of long-term unemployment the result of cyclical or structural causes? I discuss eight policy changes that would reduce the ranks of the unemployed and that would improve the efficiency of the labor market. Most of these proposals do not add big-ticket items to the Federal budget; their merits are independent of the question of how large the federal deficit should be at this time.
First published February 1, 2017 | Correction Original article: Sylvia Allegretto, Arindrajit Dub... more First published February 1, 2017 | Correction Original article: Sylvia Allegretto, Arindrajit Dube, Michael Reich, and Ben Zipperer. 2017. Credible Research Designs for Minimum Wage Studies: A Response to Neumark, Salas, and Wascher. ILR Review 70(3): 559–592. doi: 10.1177/0019793917692788 Arindrajit Dube received financial support from the Russell Sage Foundation for this research. This information was inadvertently omitted from the original article’s acknowledgment section.
The authors assess the critique by Neumark, Salas, and Wascher (2014) of minimum wage studies tha... more The authors assess the critique by Neumark, Salas, and Wascher (2014) of minimum wage studies that found small effects on teen employment. Data from 1979 to 2014 contradict NSW; the authors show that the disemployment suggested by a model assuming parallel trends across U.S. states mostly reflects differential pre-existing trends. A data-driven LASSO procedure that optimally corrects for state trends produces a small employment elasticity (–0.01). Even a highly sparse model rules out substantial disemployment effects, contrary to NSW’s claim that the authors discard too much information. Synthetic controls do place more weight on nearby states—confirming the value of regional controls—and generate an elasticity of −0.04. A similar elasticity (−0.06) obtains from a design comparing contiguous border counties, which the authors show to be good controls. NSW’s preferred matching estimates mix treatment and control units, obtain poor matches, and find the highest employment declines whe...
In the past decade a considerable number of researchers have employed microeconomic data on US la... more In the past decade a considerable number of researchers have employed microeconomic data on US labour markets in order to attempt empirical tests of the segmented labour market theories developed by Doeringer and Piore (1971) and Reich, Gordon and ...
A method and apparatus for spinning-in yarn into a spindleless spinning machine when, during the ... more A method and apparatus for spinning-in yarn into a spindleless spinning machine when, during the operation thereof, the spinning process has been interrupted due to the breakage of the main yarn thread. The device of the invention is provided with an automatic knotting mechanism which automatically feeds into a spinning nozzle an auxiliary yarn thread. The impurities in the spinning nozzle, as well as the fiber material located therein, is spun onto the auxiliary thread which is then automatically knotted to the broken-off end of the finished yarn thread by the knotting mechanism. Means are provided in the device of the invention for automatically interrupting the feeding of unfinished fibers as well as the takeup of the finished yarn thread during the knotting operation.
A proposal to raise the federal minimum wage to $15 by 2024 would increase the relative minimum w... more A proposal to raise the federal minimum wage to $15 by 2024 would increase the relative minimum wage – the ratio to the national median wage– to about .68. In Alabama and Mississippi, our two lowest-wage states, the relative minimum wage would rise to .77 and .85, respectively. Yet research on state-level minimum wage policies does not extend beyond $10; the highest studied state-level relative minimum wage is .59. To close this gap we study minimum wage effects in counties and PUMAs where relative minimum wage ratios already reach as high as .82. Using ACS data since 2005 and 51 events, we sort counties and PUMAs according to their relative minimum wages and bites. We report average results for all the events in our sample, and separately for those with lower and higher impacts. We find positive wage effects but do not detect adverse effects on employment, weekly hours or annual weeks worked. We do not find negative employment effects among women, blacks and/or Hispanics. We do fin...
Michael Reich is a Professor at UC Berkeley and Director of the UC Berkeley Institute for Researc... more Michael Reich is a Professor at UC Berkeley and Director of the UC Berkeley Institute for Research on Labor and Employment; Ken Jacobs is the Chair of the UC Berkeley Center for Labor Research and Education; Annette Bernhardt is a visiting professor of sociology and visiting researcher, Institute for Research on Labor and Employment; Ian Perry is a researcher at the UC Berkeley Center for Labor Research and Education.
In recent years, a new wave of state and local activity has transformed minimum wage policy in th... more In recent years, a new wave of state and local activity has transformed minimum wage policy in the U.S. As of August 2018, ten large cities and seven states have enacted minimum wage policies in the $12 to $15 range.1 Dozens of smaller cities and counties have also enacted wage standards in this range.2 These higher minimum wages, which are being phased in gradually, will cover well over 20 percent of the U.S. workforce. With a substantial number of additional cities and states poised to soon enact similar policies, a large portion of the U.S. labor market will be held to a higher wage standard than has been typical over the past 50 years. These minimum wage levels substantially exceed the previous peak in the federal minimum wage, which reached just under $10 (in today’s dollars) in the late 1960s. As a result, the new policies will increase pay directly for 15 to 30 percent of the workforce in these cities and as much as 40 to 50 percent of the workforce in some industries and reg...
Declining labor force participation rates among less-educated individuals in the U.S. have been a... more Declining labor force participation rates among less-educated individuals in the U.S. have been attributed to various causes, including skill-biased technical change, demand shocks induced by international competition, looser eligibility requirements for disability insurance, the opioid epidemic and the nature of child care and family leave policies. In this paper, we examine how the labor supply of parents of dependent children respond to minimum wage changes. We implement an event study framework and document a sharp rise in employment and earnings of parents after state minimum wage increases. We further show that these effects are concentrated among jobs that pay the minimum wage or slightly higher – high wage employment remains unaffected. Panel models find corresponding drops in welfare receipts, moreover, for single mothers, effects are larger for mothers of preschool age children. The results are consistent with a simple labor supply model in which means-tested transfers and...
Author(s): Reich, Michael | Abstract: Uber and Lyft currently treat their California drivers as i... more Author(s): Reich, Michael | Abstract: Uber and Lyft currently treat their California drivers as independent contractors, despite state employment law giving the drivers employee status. The companies claim that drivers are already well-paid and that employee status would bring the industry to its knees. Driver advocates claim that drivers are low-paid and do not receive basic benefits and protections, such as unemployment insurance and workers’ compensation, and that the companies should treat the drivers as employees and adhere to California employment law.I examine here the economic and financial consequences of switching the drivers to employee status. In particular, I examine the effects on pay and employment of the drivers, the effects on passengers, and the profitability of the industry. I find that: most drivers are paid much less than the current minimum wage and that overall compensation of drivers would increase 30 percent; that driver schedule flexibility would not be aff...
The surprising increase in U.S. unemployment in the Great Recession and the persistence of long-t... more The surprising increase in U.S. unemployment in the Great Recession and the persistence of long-term unemployment in the economic recovery pose important questions for employment policy. Why did unemployment grow more than forecast? Is the character of long-term unemployment the result of cyclical or structural causes? I discuss eight policy changes that would reduce the ranks of the unemployed and that would improve the efficiency of the labor market. Most of these proposals do not add big-ticket items to the Federal budget; their merits are independent of the question of how large the federal deficit should be at this time.
First published February 1, 2017 | Correction Original article: Sylvia Allegretto, Arindrajit Dub... more First published February 1, 2017 | Correction Original article: Sylvia Allegretto, Arindrajit Dube, Michael Reich, and Ben Zipperer. 2017. Credible Research Designs for Minimum Wage Studies: A Response to Neumark, Salas, and Wascher. ILR Review 70(3): 559–592. doi: 10.1177/0019793917692788 Arindrajit Dube received financial support from the Russell Sage Foundation for this research. This information was inadvertently omitted from the original article’s acknowledgment section.
The authors assess the critique by Neumark, Salas, and Wascher (2014) of minimum wage studies tha... more The authors assess the critique by Neumark, Salas, and Wascher (2014) of minimum wage studies that found small effects on teen employment. Data from 1979 to 2014 contradict NSW; the authors show that the disemployment suggested by a model assuming parallel trends across U.S. states mostly reflects differential pre-existing trends. A data-driven LASSO procedure that optimally corrects for state trends produces a small employment elasticity (–0.01). Even a highly sparse model rules out substantial disemployment effects, contrary to NSW’s claim that the authors discard too much information. Synthetic controls do place more weight on nearby states—confirming the value of regional controls—and generate an elasticity of −0.04. A similar elasticity (−0.06) obtains from a design comparing contiguous border counties, which the authors show to be good controls. NSW’s preferred matching estimates mix treatment and control units, obtain poor matches, and find the highest employment declines whe...
In the past decade a considerable number of researchers have employed microeconomic data on US la... more In the past decade a considerable number of researchers have employed microeconomic data on US labour markets in order to attempt empirical tests of the segmented labour market theories developed by Doeringer and Piore (1971) and Reich, Gordon and ...
A method and apparatus for spinning-in yarn into a spindleless spinning machine when, during the ... more A method and apparatus for spinning-in yarn into a spindleless spinning machine when, during the operation thereof, the spinning process has been interrupted due to the breakage of the main yarn thread. The device of the invention is provided with an automatic knotting mechanism which automatically feeds into a spinning nozzle an auxiliary yarn thread. The impurities in the spinning nozzle, as well as the fiber material located therein, is spun onto the auxiliary thread which is then automatically knotted to the broken-off end of the finished yarn thread by the knotting mechanism. Means are provided in the device of the invention for automatically interrupting the feeding of unfinished fibers as well as the takeup of the finished yarn thread during the knotting operation.
Uploads
Papers by Michael Reich