Ben Gitis of the American Action Forum explores employment data in states that have raised their government-mandated minimum wage.
At the beginning of January, 19 states increased their minimum wages. Twelve of the minimum wage increases were due to new laws and seven were annual inflation adjustments required under previous laws. Previously, the American Action Forum (AAF) estimated that this year’s minimum wage increases could alone cost 383,000 jobs. In addition, the minimum wage increases scheduled to go into effect over the next few years could cost 2.6 million jobs.[1] Last week the Bureau of Labor Statistics (BLS) released its January State Employment and Unemployment report.[2] While it is still very early and the data are limited, this report gives us a first look at how those states’ labor markets are responding to the January minimum wage increases. According to the BLS data, month-to-month private sector job growth slowed substantially between December and January in states that implemented new minimum wage laws, and employment in the leisure and hospitality industry declined. …
… 32.5 percent of all employed people in the US private sector worked in one of the twelve states that implemented new laws raising the minimum wage. However, in January private sector employment in those states increased by 61,300, only representing 21.4 percent of all jobs added that month. So despite containing about one-third of all private sector workers, those states under performed and only created about one-fifth of all new jobs in January. Moreover, this is a substantial decline from recent years, when those same states represented 33.6 percent to 37.4 percent of private sector jobs added in January.
