The Research Of The Employment Effects Of The Minimum Wage Based On DID Model

On January12,2012, the State Council approves the employment promotion planning(2011-2015).The planning requires the average growth of minimum wage more than13percent. This puts a boom that minimum wage had been kept growing in two years.Essentially, minimum wage is a kind of price floor. The minimum wage guarantees the basicrights and social purchasing power of laborers. The dispute of employment effects of theminimum wage has always been. The background of the paper is china’s sustainableeconomic development, a large number of low-income groups in China’s labor market,migrant worker shortage, the imperfection control of the labor market and the booming ofminimum wage. With the empirical research, the paper studies the employment effects of theminimum wage. And ultimately the paper provides decision support system to Chinaimplementing minimum wage more scientific and reasonable.Firstly, the paper reviews the origin and development of minimum wage theory, andintroduces the current situation and the reseaCrch of the employment effects of the minimumwage. The paper conducts the research on employment effects of minimum wage inHeilongjiang province, Jilin province, Hebei province, Henan province, Guangdong provinceand Fujian province through applying the method of DID. The empirical shows that theemployment effects of minimum wage are different from different provinces. Based on this,the paper studies the reason of the difference and puts the corresponding policy proposals.The proposals are raising the minimum wage standard scientificly and reasonablely, focusingon the range that minimum wage system covers, paying attention to the implementation of theminimum wage system and enhancing the training of the low skill labor force etc.