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The Impact of a Minimum‐Wage Increase on Temporary‐Contract Workers

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  • Seamus McGuinness
  • Paul Redmond

Abstract

We study the impact of the 2016 increase in the Irish minimum wage on the hours worked and the probability of job loss of minimum‐wage workers. We pay particular attention to temporary‐contract workers, who may be more susceptible to changes to their working conditions than permanent employees. The results indicate that the increase in the minimum wage had a negative and statistically significant effect on the hours worked of minimum‐wage workers, with an average reduction of approximately 0.6 hours per week. For temporary workers, the effect was greater, with a decline of approximately 3 hours per week. We find no evidence that the increase in the minimum wage led to an increased probability of becoming jobless in the six‐month period following the rate change, nor did it affect employment shares in sectors employing large numbers of minimum‐wage workers.

Suggested Citation

  • Seamus McGuinness & Paul Redmond, 2019. "The Impact of a Minimum‐Wage Increase on Temporary‐Contract Workers," Fiscal Studies, John Wiley & Sons, vol. 40(2), pages 149-173, June.
    • Handle: RePEc:wly:fistud:v:40:y:2019:i:2:p:149-173
    DOI: 10.1111/1475-5890.12186
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    References listed on IDEAS

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    1. Barry T. Hirsch & Bruce E. Kaufman & Tetyana Zelenska, 2015. "Minimum Wage Channels of Adjustment," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 54(2), pages 199-239, April.
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    3. Dale Belman & Paul Wolfson & Kritkorn Nawakitphaitoon, 2015. "Who Is Affected by the Minimum Wage?," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 54(4), pages 582-621, October.
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    Cited by:

    1. Garcia-Louzao, Jose & Tarasonis, Linas, 2023. "Wage and Employment Impact of Minimum Wage: Evidence from Lithuania," Journal of Comparative Economics, Elsevier, vol. 51(2), pages 592-609.
    2. Redmond, Paul & McGuinness, Seamus, 2023. "The Impact of a Minimum Wage Increase on Hours Worked: Heterogeneous Effects by Gender and Sector," IZA Discussion Papers 16031, Institute of Labor Economics (IZA).
    3. Redmond, Paul, 2020. "Minimum wage policy in Ireland," Papers BP2021/2, Economic and Social Research Institute (ESRI).
    4. Redmond, Paul & McGuinness, Seamus, 2022. "Heterogeneous effects of a minimum wage increase on hours worked," Research Series, Economic and Social Research Institute (ESRI), number RS132, June.
    5. Obermeier, Tim, 2022. "Individual Welfare Analysis: What's the Role of Intra-Family Preference Heterogeneity?," VfS Annual Conference 2022 (Basel): Big Data in Economics 264101, Verein für Socialpolitik / German Economic Association.

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