Resultados del análisis de los estudios del salario mínimo

Resultados del análisis de los estudios del salario mínimo

1

minimum wage reduces employment over a longer period of time than the literature has focused on in recent years. This phenomenon is particularly important given the evidence that minimum wage jobs often result in relatively rapid transitions to higher-paying jobs (Even and Macpherson 2003).

2

The results thus far indicate that the likelihood of workers losing their jobs increases when the cost of employing them rises, and that this likelihood increases even more when the cost increase is due to an increase in the contribution base than in the minimum waget. It is possible that increases in the contribution base do not reduce overall employment but simply increase the amount of labor turnover, as employers suddenly find it worthwhile to replace unproductive workers with more carefully selected new hires. The difference between the two effects is even larger when only low-wage workers are used as a comparison group. I found certain demographic groups, including women, rural workers, and those under 30, to be more vulnerable to policy changes than others. My results indicate that employers are less likely to dismiss workers in response to a given increase in labor costs when the increase results in higher wages for their workers rather than in a transfer payment to the government; possibly this is because in the former case workers are likely to put in more effort.

3

The results of the analysis in this study show that increases in minimum wages have a negative impact on urban formal sector employment, except in the case of white-collar workers. For all workers, the estimated elasticity of total employment to the minimum wage is around –0.1 and is statistically significant. This implies that for every 10% increase in real minimum wages, there will be a reduction of around 1% in total employment, controlling for other factors affecting employment, such as economic growth and growth in the size of the working population. Significantly, the negative employment impact of minimum wage increases is greatest for those groups that are most vulnerable to changes in labour market conditions, such as female, young and less educated workers, who make up the bulk of Indonesia’s labour force. For female and young workers, the employment elasticities with respect to minimum wages are around –0.3, while for less educated workers they are around –0.2. White-collar workers are the only group to have benefited from minimum wages in terms of employment. These results imply that minimum wages benefit some workers and disadvantage others. Workers who keep their factory jobs clearly benefit from increases in the minimum wage. Whitecollar workers are clear winners from a vigorous enforcement of minimum wage policy. However, those who lose their jobs in the formal sector as a result of increases in minimum wages— and face lower earnings and poorer working conditions in the informal sector—are losers from minimum wage policy. The potential losers are those most vulnerable to changes in labour market conditions, such as female, young, and less educated workers.

4

This article tested empirically the hypothesis often mentioned that the minimum wage does have an impact on the informal labour market, possibly even a stronger impact on the informal than formal labour market. I found empirical support that the minimum wage and minimum wage changes have an impact on informal wages and even a higher impact on informal sector wages than formal sector wages. The difference-in-difference estimations for the 1993 minimum wage change showed a significant positive impact on informal sector wage distribution and on overall wages. These results were robust when looking at the kernel densities of a 2004 minimum wage change. In the traditional view of the dual labour market by Harris and Todaro (1970) the informal sector would have experienced a wage decrease due to minimum wage increases in the formal sector. After the minimum wage increase in the formal sector, some unemployed workers of the formal sector would seek employment in the informal sector, thereby driving informal sector wages down. Yet, the results in this article do not support this view of the labour market as an increase of informal sector wages, even stronger than formal sector wages, was estimated.

5

Strong evidence supports that a small minimum wage increase actually reduces the annual wage growth for many low-wage workers. Larger minimum wage increases have positive wage effects that spill over to workers with wages higher than the new minimum wage. Workers with wages in the top three quartiles of the wage distribution do not seem to experience any wage impact from a minimum wage increase regardless of the size. These findings are robust to a variety of alternative specifications and are generally consistent by income, gender, race, and age. Finally, our study does not consider any increased unemployment risk for a low-wage worker as a result of a minimum wage increase. Even with these limitations, the results indicate that a small minimum wage increase likely reduces wage growth for low-wage workers

6

The employment effects of an increase in the minimum wage are strong and negative in markets with low turnover and in markets with short durations of nonemployment for workers who separate from their jobs. Conversely, increases in the minimum wage are associated with increases in employment in high-turnover markets and in markets with high nonemployment durations. These results are robust to various specifications and are not driven by variation in bindingness of the minimum wage. Our results are consistent with the view that shorter durations of nonemployment correspond to more competitive markets. In the most competitive markets, we expect the data to behave similarly to the way the neoclassical demand model predicts—increases in the minimum wage bring decreased employment. In the least competitive markets, conditions may be closer to dynamic oligopsony, in which it is possible that higher minimum wages may increase employment.

7

The results show that higher minimum wages are associated with decreases in unemployment spell length for most males; particularly those who. are older, higher-skilled, and have graduated from high school. Nevertheless, there are substantial increases in unemployment duration for males who did not complete high school. Along with male high school dropouts, females appear to bear the brunt of higher minimum wages, as there is no evidence of shorter unemployment spells, while a few groups (older, lower-skilled, and high school graduates) experience longer unemployment duration. If employers are required to pay higher wages to younger and less-skilled workers, they may perform the necessary screening to acquire older, more-experienced job candidates at the expense of relatively disadvantaged labor market participants. In this case, however, it appears that older males and those who have completed high school benefit from this, but not their female counterparts.

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