Impacts of Minimum Wage Increases in the US Retail Sector: Full-Time versus Part-Time Employment

40 Pages Posted: 10 Feb 2020 Last revised: 21 May 2020

See all articles by Koichi Yonezawa

Koichi Yonezawa

Cornell University - Dyson School of Applied Economics and Management

Miguel Ignacio Gomez

Cornell University - Food Industry Management Program

Edward W. McLaughlin

Cornell University - School of Applied Economics and Management

Date Written: May 20, 2020

Abstract

State and federal minimum wage hikes are likely to impact the retail industry employing a great number of less well-compensated part-time workers. Despite the relevance of this issue, it is not clear how minimum wage increases affect full-time and part-time retail employees differentially. In this study, using state-level monthly data from the Current Population Survey (CPS), we find 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 hours of full-time workers in order to stay within a labor budget and keep serving their customers.

Keywords: employment, full-time labor, labor demand, minimum wage, part-time labor, retailing

JEL Classification: J23, J30, L81

Suggested Citation

Yonezawa, Koichi and Gomez, Miguel Ignacio and McLaughlin, Edward W., Impacts of Minimum Wage Increases in the US Retail Sector: Full-Time versus Part-Time Employment (May 20, 2020). Available at SSRN: https://ssrn.com/abstract=3520915 or http://dx.doi.org/10.2139/ssrn.3520915

Koichi Yonezawa (Contact Author)

Cornell University - Dyson School of Applied Economics and Management ( email )

Ithaca, NY
United States

Miguel Ignacio Gomez

Cornell University - Food Industry Management Program ( email )

Department of Applied Economics and Management
Ithaca, NY 14853
United States
607-255-8472 (Phone)
607-255-4776 (Fax)

Edward W. McLaughlin

Cornell University - School of Applied Economics and Management ( email )

248 Warren Hall
Ithaca, NY 14853
United States
607-255-3169 (Phone)
607-255-4776 (Fax)

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