The impact of minimum wage on the employment of rural migrant workers in China

This paper examines the impact of minimum wage on the employment of rural migrant workers using data from the 2011-2018 China Migrants Dynamic Survey (CMDS). The findings indicate that an increase in the minimum wage significantly enhances both the willingness to participate in the labour market and the employment rate among migrant workers. This result has passed a series of endogeneity and robustness tests. The heterogeneity analysis reveals that the impact of increasing the minimum wage is more pronounced among female, low-skilled, and young to middle-aged migrant workers. Additionally, the effects of minimum wage increases are more substantial in regions with effective implementation. Further analysis reveals that the increase in the minimum wage has raised the wage levels of migrant workers at the middle and lower percentiles. It has neither increased their working hours nor changed their probability of obtaining various social insurances and the form of labour contracts. The conclusion shows that the increase in the minimum wage from 2011 to 2018 did not harm the employment and welfare of migrant workers. Instead, a reasonable increase in the minimum wage is helpful to improve the wage level of migrant workers and narrow the wage gap within migrant workers.