doi.org
The impact of the minimum wage on gross employment flows: An analysis at province level in Spain
This study investigates the effect of the minimum wage on gross employment flows, focusing on hiring and employment separations, as well as on net employment outcomes. Using aggregate data from an administrative data source covering Spanish provinces from 2015 to 2023, we find a significant negative effect of the minimum wage on hires and separations in provinces where a larger share of minimum wage earners exists compared to other provinces. However, the net employment effect, although positive, is close to zero, indicating that the size of the reduction in hires and separations is similar. Furthermore, a rise in minimum wage incidence leads to an increase in hiring and separations among part-time time workers, while it reduces them among full-time workers. The effects, although statistically significant, are small and economically negligible.