Citywide Minimum Wage Laws: A New Policy Tool for Local Governments

Abstract

Over the past three years, a new trend in wage legislation has emerged in several cities across the United States. In response to Washington’s longstanding refusal to preserve the value of the federal minimum wage at a meaningful level, these cities have recently enacted minimum wage laws of their own. The laws require local employers to pay a minimum wage that is higher than the state or federal minimum wage. And, significantly, these new laws apply to a far greater number of employers than do better-known and much more numerous “living wage” laws. Although living wage laws also require higher minimum wages, they generally extend only to those businesses that receive contracts or business subsidies from cities. The new citywide laws are significantly more comprehensive in that they cover most or even all employers in each city. Because of their broad coverage, citywide minimum wage laws offer local governments a valuable new policy tool for raising the incomes of working families in their communities. This policy brief recounts some key facts about our nation’s minimum wage landscape. It then describes the new citywide minimum wage laws in the context of other wage legislation. Finally, it summarizes research findings on the economic impact of enacting these citywide measures.