Differential Impact of Minimum Wage Changes at the Federal and State Level
This study employs a causal design to determine if minimum wage changes at the federal and state level have differential effects on different demographic workers. States have the authority to raise the minimum wage higher than the federal minimum wage. Twenty-nine states and Washington, D.C. maintain higher minimum wages than the federal standard as of 2019. This difference in values means that there would be a difference in how the minimum wage impacts workers in different states. Two models, one using the federal minimum wage and the other average for State minimum wage, were estimated against the quarterly earnings of different demographic workers. The results align with the findings of earlier studies (Bazen and Gallo, 2009). Federal level changes were statistically significant for workers with less than a high school diploma, and females. The statistically significant variables at the state level were female, white, and black workers.