In their Nov. 19 commentary ("Unfavorable minimum wage study is flawed," Opinion Exchange) Dave Kamper and Clark Goldenrod misrepresent the Minneapolis Federal Reserve Bank's role and the findings of its recent study of minimum wage increases in Minneapolis and St. Paul.
The Minneapolis Fed was selected by the cities of Minneapolis and St. Paul to research the impact of their respective minimum wage laws, in part, because policymakers and stakeholders alike were confident that our analysis would be objective and nonpartisan. Our role is not to prescribe policy solutions or to leverage our research to tip the scale for or against minimum wage increases, but rather to help illuminate the impacts and trade-offs of such policy choices. It is up to our elected officials and community stakeholders to advance appropriate policy solutions.
Kamper and Goldenrod may be disappointed in the initial findings, but our work is fully transparent about its methods and data. Our researchers use widely accepted methodology, and we are confident in them. Our primary results focused only on the pre-pandemic years of the wage increase, where we found limited effects on jobs, and only in the restaurant industry. While we provide a preliminary analysis of 2020, as required by contract, Kamper and Goldenrod conveniently overlook our cautions that these results are extremely difficult to interpret at this stage.
This research will further our understanding of the effects of minimum wage policies thanks to a unique data-sharing agreement with the state of Minnesota, which passed the Legislature with bipartisan support. The recent report is the first of several running through 2028. We have no idea what the ultimate findings will be. However, we welcome feedback and constructive discussion from policymakers, researchers and the public. This project will help advance our congressional mandate to achieve maximum employment and we look forward to building on our partnerships with Minneapolis and St. Paul.
Mark Wright, Minneapolis
The writer is research director and senior vice president, Federal Reserve Bank of Minneapolis.
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Every day we're hearing a constant drumbeat about worker shortages in all types of jobs ranging from truck drivers to dock workers to health care workers in nursing homes and hospitals to school employees to city bus drivers. Many restaurants still can't expand their hours to what they were before the pandemic because they can't hire anyone even after significant hikes in hourly wages. Small businesses are struggling to hire. We're seeing lots of hand-wringing by the media and by politicians on all sides, yet they all seem afraid to identify the obvious solution, which is to substantially increase immigration.