Good for Business: Small Business Growth and State Minimum Wages

May 10, 2006
   

Does a higher minimum wage hurt small business and cause job loss? Not according to this comprehensive analysis of small business establishment, payroll and employment growth. This study compared small business performance in states with a higher minimum wage to performance in states where the federal minimum wage prevailed between 1997 and 2003. Good for Business: Small business growth and state minimum wages found that jobs grew more, payrolls grew more, and the number of establishments grew more in states with a higher minimum wage. Just one more piece of evidence that higher minimum wages are an important part of an economy that works better for everyone.

Source: Authors calculations based on CBP Annual Reports. Weighted data.

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