Impacts of Minimum Wage Increases in the U.S. Retail Sector: Full-Time versus Part-Time Employment
By: Yonezawa, Koichi ; Gmez, Miguel I. ; McLaughlin, Edward W.
Yonezawa, Koichi ; Gmez, Miguel I. ; McLaughlin, Edward W., Impacts of Minimum Wage Increases in the U.S. Retail Sector: Full-Time versus Part-Time Employment, Journal of Agricultural and Resource Economics, Volume 47, Issue 2, May 2022, Pages 324-341
State and federal minimum wage hikes are likely to impact the retail industry, including grocery stores, which employs a large number of less-well-compensated part-time workers. Despite its relevance, it is not clear whether minimum wage increases affect full- and part-time retail employees differently. We use state-level monthly data from the Current Population Survey (CPS) to show that minimum wage hikes lead to rising part-time wages but not to declining part-time employment. Instead, retailers reduce their full-time employment and the hours worked by full-time workers in order to stay within a labor budget and continue serving their customers.