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Careers of Minimum Wage Workers

Author

Listed:
  • Sari Pekkala Kerr
  • William R. Kerr
  • Louis Maiden

Abstract

We characterize the careers of minimum wage workers by merging SIPP panels covering 1992-2016 into the LEHD. A long-run analysis shows strong earnings growth for these workers in subsequent decades, becoming indistinguishable from peers earning modestly more initially. Most of this growth is due to the steep earnings trajectories of young workers. Older workers earning minimum wages show a modest dip in earnings at that moment compared to earlier and later periods. Increases in state minimum wages do not significantly alter the future careers of workers who are on the minimum wage when the increases occur.

Suggested Citation

  • Sari Pekkala Kerr & William R. Kerr & Louis Maiden, 2026. "Careers of Minimum Wage Workers," Working Papers 26-07, Center for Economic Studies, U.S. Census Bureau.
    • Handle: RePEc:cen:wpaper:26-07
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    File URL: https://www2.census.gov/library/working-papers/2026/adrm/ces/CES-WP-26-07.pdf
    File Function: First version, 2026
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    More about this item

    Keywords

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    JEL classification:

    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • J78 - Labor and Demographic Economics - - Labor Discrimination - - - Public Policy (including comparable worth)

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