The Effect of Minimum Wage Change on Employer Provide Health Insurance Coverage from 2010 to 2019

My research examines the impact increases in the minimum wage have on employer provided health insurance coverage, taking data from 2010 to 2019 using the American Community Survey Microdata. Previous studies differed in their conclusions, some found that the minimum wage had no significant effect on employer provided health insurance coverage, whereas others found that increases in the minimum wage reduced eligibility for employer provided health insurance and thus reduced one’s likelihood for coverage. Minimum wage data from 2010 to 2019 is obtained from the US Department of Labor. This paper provides evidence that increases in the minimum wage during this time do in fact reduce one’s likelihood for employer provided health insurance coverage by a small but statistically significant amount. For a one dollar increase in the minimum wage, one’s likelihood of receiving health insurance coverage by one’s employer reduces by one percentage point. This may suggest that simply implementing new minimum wage laws on their own may not be the best way in increasing worker welfare, as firms can offset the increased costs through reducing non-wage benefits. Better protection for workers, such as through increased union membership, may be a more effective measure in ensuring greater welfare for low paid employees.