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Auswirkungen des gesetzlichen Mindestlohns auf Betriebe und Unternehmen

Author

Listed:
  • Bossler, Mario

    (Institute for Employment Research (IAB), Nuremberg, Germany)

  • Gürtzgen, Nicole

    (Institute for Employment Research (IAB), Nuremberg, Germany)

  • Börschlein, Erik-Benjamin

    (Institute for Employment Research (IAB), Nuremberg, Germany)

Abstract

"This report contains the results of the research project "Effects of the statutory minimum wage on establishments and enterprises". The project is carried out by the Institute for Employment Research (IAB) on behalf of the German Minimum Wage Commission. The report focuses on detailed empirical analyses of the effects of the introduction and the first increase of the statutory minimum wage in Germany on various establishment-level outcomes. The empirical analysis is mainly based on the difference-in-differences approach, which is largely applied at the establishment level. Prior to the empirical analysis, we provide a detailed description of the empirical methodol-ogy and the data. Concluding the report, we give a summary of the results and an outlook on future analyses of minimum wage related adjustment reactions. While the analyses based on the IAB Establishment Panel show a moderate negative effect of the minimum wage introduction on employment (approx. -88,000 employment relationships), the effect of the first minimum wage increase in 2017 tends to be positive for the affected establishments (approx. +39,000 employment relationships). The positive effect of the minimum wage increase seems to be plausible because the increase in real wages is only 0.9 percent (annually), while the labor market developed positively in the low-wage segment. The overall employment effect is extrapolated to a decline of 49,000 jobs by 2018, while the effect is particularly concentrated on es-tablishments in Eastern Germany and employers that feel exposed to high competitive pressure. In monopsonistic industries, however, the effect is relatively small. For special employment groups including temporary workers, freelancers and interns, we cannot empirically verify a significant employment effect of the minimum wage. Analyses of the overall labor demand with the IAB Job Vacancy Survey do not indicate a significant effect of the minimum wage on the number of vacancies. With regard to profitability of establishments, the analyses show a significant negative impact of the introduction of the minimum wage, but do not provide evidence of any significant effects of the first minimum wage increase. The profitability-decreasing effect of the introduction of the minimum wage is mainly due to the increase in operational personnel costs. At the same time, the analyses do not show any significant effect on the productivity of the affected establishments, indicating that the affected establishments did not compensate the minimum wage by increasing the productivity of their employees. Analyses of the effects of the minimum wage on investments in physical and human capital show significant negative effects in the short run for the year after the introduction of the minimum wage. Affected establishments initially reduced their investment levels right after the introduction of the minimum wage, but they did not show any minimum wage-related adjustment in their investment behavior in the following years. However, we clearly observe a structural difference that already existed before the minimum wage was introduced or increased. Establishments not affected by the minimum wage invest considerably more in physical capital and in the training of their employees. Effects on the share of apprentices and the number of apprenticeship training positions offered or filled are neither found for the minimum wage introduction nor for the first minimum wage increase. Consequently, investments in apprenticeship training were not reduced because of increased personnel costs. The results also do not indicate any effects of the introduction or increase of the minimum wage on integration or outsourcing activities of establishments or on the share of intermediate inputs in the production process." (Author's abstract, IAB-Doku) ((en))

Suggested Citation

  • Bossler, Mario & Gürtzgen, Nicole & Börschlein, Erik-Benjamin, 2020. "Auswirkungen des gesetzlichen Mindestlohns auf Betriebe und Unternehmen," IAB-Forschungsbericht 202005, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  • Handle: RePEc:iab:iabfob:202005
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    File URL: https://doku.iab.de/forschungsbericht/2020/fb0520.pdf
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    References listed on IDEAS

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    Cited by:

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