More Evidence on the Minimum Wage

By Jeffrey Miron.

"States and cities never seem to tire of hiking their minimum wages, with predictable effects:

On April 1, 2024, California raised its minimum wage from $16 to $20 per hour for fast-food workers employed at chains with more than 60 locations nationwide. This was one of the largest one-time minimum wage increases in US history, and one of the few focused on a single industry in recent decades.

Our research finds that employment in California’s fast-food sector declined by 2.7 percent between September 2023 and September 2024 relative to fast-food employment elsewhere in the United States. … Our median estimate suggests that California lost about 18,000 jobs that could have been retained if Assembly Bill 1228 had not been passed.

If a society wishes to redistribute income, it should redistribute income (e.g., via a negative income tax). Interfering with market wages generates counter-productive results."