Minimum Wages For Women Only
May 9, 2001
The Massachusetts state minimum wage law of 1912 -- the first minimum wage law in the nation -- applied to women only. Its effect was to reduce the participation in the workforce of poorer, less-educated women, says economist Clifford F. Thies.
Basing his analysis on the state's annual survey of manufacturing and contemporary minimum wage theory, Thies finds:
- Women's employment fell in 1913 not because of economic recession, but because of the minimum wage law.
- As the minimum wage law made the labor of less-skilled women too expensive, employers increased their demand for high-wage labor and capital, resulting in an increase in male employment.
- Many employers also responded to the increase in labor costs by eliminating "slack time," for example, by shifting from an hourly rate to a piece rate.
The increase in female job loss was measurable -- six percent in the laundry industry to 14 percent in the brush industry -- among the quarter of female workers eventually covered by wage standards.
The job loss would have been even larger had Massachusetts not granted a large number of licenses to "slow workers" exempting them from the minimum wage law.
The Commonwealth of Massachusetts probably issued exemptions liberally because its only enforcement power was to publicize the names of companies violating the wage decrees, says Thies.
Through 1923, minimum wage laws for women were enacted in 14 additional states, the District of Columbia, and Puerto Rico. The laws applied only to women, because freedom of contract was not then fully enjoyed by women. However, in 1937, in West Coast Hotel v. Parrish, the Supreme Court ruled that freedom of contract was not a constitutionally protected right -- and thus minimum wage laws applying to both men and women are constitutional.
Source: Clifford F. Thies, "Minimum Wages for Women Only," Independent Institute Working Paper No. 30, April 2001, Independent Institute, 100 Swan Way, Oakland, Calif. 94621, (510) 632-1366.
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