In June 2004 Santa Fe became one of three cities in the United States to pass a city-wide minimum wage applying to private businesses. The city’s increase to $8.50 an hour—a 65 percent increase—affected all businesses within city limits employing more the 25 people. The wage floor is scheduled to increase to $9.50 on January 1, 2006, to $10.50 on January 1, 2008, and then it will be indexed to inflation in the years following. With the wage hike in effect for nearly a year and a half—and with another increase to $9.50 on the horizon—it is appropriate to empirically assess the labor market affects of Santa Fe’s minimum wage. This paper by Dr. Aaron Yelowitz, a respected labor and health economist at the University of Kentucky, builds upon an earlier work published in September, 2005. It extends the results of the original paper and addresses a number of unfounded criticisms made by supporters of minimum wage increases—specifically those by Drs. Robert Pollin and Jeanette Wicks-Lim.
Available at: http://works.bepress.com/yelowitz/26/