Thoughts: 2021

The Effects of Major Retailers Raising Their Minimum Wages

Ellora Derenoncourt, Clemens Noelke, and David Weil
National Bureau of Economic Research. December 2021

Minimum wage announcements by national firms have striking spillovers to other firms. Many employers responded to Amazon’s $15 minimum wage by matching it.

Between 2014 and 2019, five major national retailers — Amazon, Walmart, Target, CVS, and Costco — implemented company-wide minimum wages. Ellora Derenoncourt, Clemens Noelke, David Weil, and Bledi Taska investigate the impacts of these policies on low-wage workers who are not employed by these firms in Spillover Effects from Voluntary Employer Minimum Wages (NBER Working Paper 29425). They first illustrate their findings using Amazon’s $15 minimum wage, which was announced in October 2018 and took effect that November 1. They then show these patterns generalize to the other large retailer minimum wages.