The Economic Impact of the San Francisco Municipal Minimum Wage Policy

Awarded Scholars:
Michael Reich, University of California, Berkeley
Project Date:
Jan 2004
Award Amount:
$29,052
Project Programs:
Future of Work

 

In November 2003, San Francisco voters passed "Proposition L," which established a citywide minimum wage increase from $6.75 to $8.50 per hour that would be adjusted annually for inflation. While some critics assert that the new minimum wage law will lead to job layoffs and higher prices, others champion the law as providing a much needed wage floor for thousands of the city's low-wage workers.

To assess the actual impact of the minimum wage increase, Arindrajit Dube and Michael Reich will conduct a baseline survey of restaurant owners in San Francisco and Oakland, asking about their number of employees, tips received, and restaurant prices. The survey will allow the researchers to compare restaurants that are exempt from the law because of their small size with those that face a higher wage floor because of the law. They will conduct a follow up study one year later to investigate whether distinctive employment or price changes can be found because of the minimum wage increase.

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