Minimum Wage Hikes Improve Job Quality Without Cutting Employment, Study Finds
Raising the minimum wage doesn't just lift paychecks—it transforms low-quality jobs into middle-class opportunities. A National Bureau of Economic Research study analyzing Uruguay's 80% minimum wage hike reveals a tripling of real wages between 2004-2013, with no corresponding job losses. The policy compressed wage inequality by forcing lagging employers to match better-paying competitors.
The findings challenge conventional economic wisdom, mirroring U.S. research showing wage floors reduce inequality without reducing employment. With the federal minimum wage stagnant at $7.25 since 2009, the study suggests policymakers could elevate job quality standards through aggressive wage policies. "Good jobs"—defined by living wages, benefits, and career mobility—became more accessible as the wage floor rose.
