The employment effects of minimum wage in Poland Piotr Lewandowski - PowerPoint PPT Presentation

The employment effects of minimum wage in Poland Piotr Lewandowski Agnieszka Kamińska

Minimum wage in Poland 1720 1665 45% 1600 1556 1466 1461 1499 1520 1348 40% 1320 1022 1056 1079 1074 1114 1148 1093 1078 1120 35% 920 720 30% as a proportion of average monthly earnings (right axis) at prices of 2013 (left axis)

Minimum wage earners Percentage of all full-time workers earning below the minimum wage 12 HBS LFS 10 8 6 4 2 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

1. Total employment 2. The structure of What we have done employment 3. Groups DATA Propensity Score Average Treatment Matching Effects • LFS for Poland • ATT on probabilities • Criteria: of outflows to: • Yearly panel • Personal • Period: 2001- characteristics • inactivity 2013 (sex, age, educational • unemployment • Persons under attainment, marital 55 years of age • or remaining status etc.) employed • Robustness: • Job characteristics • HBS for Poland • Treated – workers (profession, • Yearly panel earning in t more than employment status etc.) • Period: 2001- 80% of MW in t and 2012 less than MW in t+1 • Firm characteristics • Not here yet (size, sector)

1. Total employment 2. The structure of Effect on employment employment 3. Groups ATT on the probability of remaining employed 2001-2012 2001-2012 2001-2006 2007-2012 0% -2% -4% ** -6% *** ** -8% The effect lower in the 2007- 2012 period → relatively higher labour demand p-value: * - 0,05; ** - 0,01; *** - 0,001

1. Total employment 2. The structure of Effect on employment employment 3. Groups ATT on the probability of remaining employed by the form of current contract 2001-2012 2001-2012 2001-2006 2007-2012 0% -2% * -4% ** * -6% ** -8% *** ** -10% permanent temporary p-value: * - 0,05; ** - 0,01; *** - 0,001

1. Total employment 2. The structure of Workers with permanent contracts employment 3. Groups 2001-2006 2007-2012 2,5% *** ** 2,0% ** 1,5% *** 1,0% ** ** 0,5% 0,0% temporary unemployment inactivity employment p-value: * - 0,05; ** - 0,01; *** - 0,001

1. Total employment 2. The structure of Workers with temporary contracts employment 3. Groups 2001-2006 2007-2012 8% ** 6% ** 4% ** *** 2% 0% ** -2% *** -4% permanent unemployment inactivity employment p-value: * - 0,05; ** - 0,01; *** - 0,001

1. Total employment 2. The structure of Gender employment 3. Groups The effect on the probability of remaining employed men women • 62% of the minimum- 0% wage earners are women -1% • 8% of women earning MW -2% have tertiary education , -3% compared to 4% of men -4% *** -5% -6% *** -7% p-value: * - 0,05; ** - 0,01; *** - 0,001

1. Total employment 2. The structure of Age employment 3. Groups 15-29 30-44 45-55 The minimum wage 0% earners: -1% -2% • 15-29 years – 33% -3% ** • 30-44 years – 42% -4% *** -5% • 45-55 years – 25% -6% -7% -8% -9% *** -10% p-value: * - 0,05; ** - 0,01; *** - 0,001

1. Total employment 2. The structure of Educational attainment employment 3. Groups post-secondary lower and secondary general basic secondary and tertiary vocational secondary vocational primary 0% -2% -4% ** -6% ** ** *** -8% -10% *** -12% • Tertiary educated constitute 6% of the minimum-wage earners p-value: * - 0,05; ** - 0,01; *** - 0,001

1. Total employment 2. The structure of General secondary education employment 3. Groups Men, average wages in 2013 4000 3500 3000 2500 2000 1500 1000 500 0 15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 >65 Civil law contract Employment contract Difference in wages of employees and civil law contractors are highest among men with general secondary education

In recent years Increase of the minimum wage in Poland: Had a modest impact on total employment 1. Probably influenced the structure of employment 2. Good timing with a strong labour demand after 2007 3.

Minimum wage vs. poverty Percentage of near-minimum-wage earners 16 2007 14 2012 12 10 8 6 4 Relative poverty 2 line in 2012 0 1 2 3 4 5 6 7 8 9 10 Deciles of equivalised income

Thank you for your attention #dualityconf2014 piotr.lewandowski@ibs.org.pl agnieszka.kaminska@ibs.org.pl www.ibs.org.pl twitter.com/ibs_thinktank