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Abstract
We examine the impact of Oregon’s tiered minimum wage policy on working hours in the food manufacturing sector by comparing two regions that face different minimum wages under Oregon law: the Portland Metro Area and the “Standard Counties” outside of the metro area. The food manufacturing sector is a vital component of Oregon’s economy, significantly contributing to job creation and exports, and is not immune to wage policy changes given its concentration of low-wage workers. Using a spatial regression discontinuity design and a difference-in-differences estimation strategy, we find no evidence that the introduction of the policy had a significant negative effect on working hours. We find, in our spatial regression discontinuity design, that there is no detectable local effect at the boundary and that the minimum wage policy did not change the discontinuity at the boundary. Additionally, we do not find a significant average treatment effect in the difference-in-differences (DiD) specification. These findings suggest that the negative effects often predicted with minimum wage increases are either not present in this case, or small enough as to be undetectable with the available data on food processing employment. Our results contribute to the broader discussion on how labor markets in low-wage sectors respond to changes in minimum wage policies.