In the context of weak wage growth, many communities have either raised their minimum wage or are contemplating doing so. One of the arguments often put forth to support these proposals is that raising minimum wages reduces the reliance of lower wage workers on government programs, saving taxpayers money.
According to a new study funded in part by the Employment Policies Institute, increases in federal or state minimum wages have no statistically significant impact on the use of public assistance programs. According to the report, the primary issue is that there isn’t much overlap between those who would be impacted by say a fifteen dollar minimum wage and those who receive public assistance.
For instance, among those who would be affected by a $15 minimum wage, only twelve percent are recipients of Supplemental Nutritional Assistance, or what used to be known as the food stamp plan, and only ten percent are on Medicaid.
The study also analyzed the effect of minimum wage increases on participation in other programs, including those providing cash or housing assistance. As reported by the Wall Street Journal, the study uses data from various sources including the Current Population Survey and the Survey of Income and Program Participation.
